Honcho

Honcho Markets Ltd. was an insurtech company founded in the UK in 2016 by Gavin Sewell and Frank Speight, aiming to alter the personal lines insurance market. Sewell, with a background in computer science and extensive experience in electronic trading systems for investment banks, served as CEO. Speight, an insurance industry veteran with senior roles at firms like Aon and Lloyd's of London, was the Commercial Director. The company was established to address the perceived flaws in the insurance distribution model, particularly the consumer focus on price over suitability.

The core of Honcho's business was a reverse-auction marketplace for car and van insurance, accessible via a mobile and web app. Unlike traditional price comparison websites, Honcho allowed consumers to submit their insurance needs, prompting insurers, brokers, and MGAs to bid against each other in real-time to offer the best policy package. This 30-second auction process was designed to shift focus from merely the cheapest premium to the best overall value, measured by a "honchometer" score that indicated how well a bid matched the user's specified needs. The business model was distinct in its revenue generation; instead of charging a commission per policy, Honcho charged insurers a flat £1 fee to bid for a customer's business, fostering a more transparent and competitive environment. The platform successfully attracted over 40 insurance providers, including major names like Axa, Aviva, and Admiral.

From its inception, Honcho secured significant funding, raising over $7.94M through a combination of crowdfunding, angel investors, and venture capital from firms like Maven Capital Partners and Insurtech Gateway. The company launched its app in August 2019, initially targeting the young driver market before expanding. Despite acquiring over 30,000 users and gaining international recognition through programs like the Insurtech NY accelerator, Honcho faced substantial challenges. In July 2022, the company announced the closure of its marketplace. The primary reason cited was the immense financial pressure of competing with major price comparison websites, whose marketing expenditures exceeded £100 million annually, making customer acquisition economically unviable for the startup. An attempted pivot to an embedded insurance model for car dealerships proved insufficient to save the company. By October 2022, Honcho Markets Ltd. had ceased trading and entered liquidation after failing to find a buyer, leaving a reported deficiency of over £4.87 million.

Keywords: Honcho Markets, reverse auction insurance, insurtech, car insurance marketplace, Gavin Sewell, Frank Speight, UK startup, insurance comparison, embedded insurance, venture capital, insurtech casualty, competitive landscape, customer acquisition cost, price comparison website alternative, van insurance, Maven Capital Partners, Insurtech Gateway, financial services marketplace, insurance distribution, fintech