SA start-up success: How the ‘uber’ of actuaries has developed into a R35m/year revenue business in 3 years

South African entrepreneur Adi Kaimowitz has developed a collaborative of actuaries in a business model that has been referred to as “the Uber of actuaries”. In this interview with BizNews, he shares the details of his start-up success, with tips for other aspirant entrepreneurs, and he explains how collaborations like Virtual Actuary can be applied across sectors. – Jackie Cameron

Adi Kaimowitz on his business idea:

We’re a group of actuaries that work to service the life insurance and investments in the banking sector. How I came about this was, I had spent 10 years working as a recruiter of actuaries. Unfortunately, digitisation websites like LinkedIn made it very difficult for recruiters to make a living. I had nurtured a great network of actuaries and what does one do with a network of actuaries? It took about two years to pivot and a few different ideas. The idea that really stuck was ‘we’ll form own consultancy and we will operate in a more efficient way, using technology to service the clients. 

On how it works for clients:

Our clients are your big insurers, big banks [and] big reinsurers. Generally the clients themselves is the director actuary that has teams of actuaries working inside the organisation. We do have the smaller clients, but our main clients are the big organisations. They will sometimes not have the right skill set or the right capacity internally for various reasons – somebody immigrates, for example.

There are many reasons why they have a gap for a manager that fills up for the next year or two, and it’s very difficult to find somebody. So they will generally outsource that to an actuary consultancy within banking, insurance, health care or investments. We are that consultancy. We will come in and integrate ourselves into the client’s business – sometimes nurturing their youngsters or sometimes being the managers on a piece of work. Sometimes being the absolute experts as well.

We try to be an ongoing outsource partner to our clients. Where we can help them scale up or scale down their projects over the space of six months to a year, and let them then take over from that, so they can have their own internal people in there. We’re just a traditional consultancy that all works together on one delivery for that client.

I think it’s important to note what we’re talking about here. We are in the era of the gig economy and being able to tap into extra help because that’s a normal consultancy. But if you think about it, each employee at a normal consultancy is doing a gig. So when the client uses the consultancy instead of hiring the consultancy – who sends out their employees to do the work and they get a salary and bonus – the difference is they send the work to us. Our gig economy contractors (which are full-time) do the work. We have delivery managers. We take it on as a consultancy, but ours is a shared revenue model.

On other opportunities in the economy like this:

 I can just say that it absolutely breaks my heart. But I’d also like to talk about practical suggestions to finding a job. It’s difficult because there aren’t that many companies that are hiring. Everyone’s holding back. You now have this ability – experience – that no one can take away from you. You can do a gig. I can run a marketing department. I can do social media. I can run courier business operations.

You can do a gig. That’s your job responsibility. If you can understand what industry you work in and what the different responsibilities are and the different units that allow you to operate as an entity, you can go to that person and say you have that ability. We used to run all the different units of that company. That company just closed down. So let’s band together and form a consortium, a gig economy consortium. We’ll have all the terms of business and contracts – everything organised – and let’s go and knock on some doors to pick up work.

Where this differs from the old way of thinking – the old way of thinking is we have to form a mini PTY LTD. We have to form a new business. I need to bring these people in and we need to form a business. If we want to go and do this, let’s go open a registration number and a bank account. There’s shared equity, shared responsibility, salaries – that whole thing about we need a budget to operate [and] we’re partners in a business etc.

You’re taking away all of that ‘partners in a business’ situation. We are saying we have a shell that can do the contracts and everything with the business, but everyone that’s involved will only get paid when the client pays. That’s the understanding. You’re not on a salary, but if you’re happy to get paid when the client pays, then we need you. We’re going to put this product together and we’re going to get hold of the client.

The sales person is part of that unit. So everyone does their bit. But then you have a pre-arranged agreement – from a shared revenue perspective – that when that money comes in, the designer gets R50,00 a month, the salesperson gets R10,000, this person gets R15,000. This person’s doing most of the work [so] they get R120,000 because that’s fair. But as a unit, you can go out there and service together.

If you are finding yourself in a situation where you have to go find work as a new small business, you don’t have to go and open a small business with a group of people. Rather, open the business as a consortium, then try and bring commission earning participants in – who will share the revenue when the client pays. That’s really the difference in a consortium, in an organised gig economy system.

On what’s next for Virtual Actuary:

We have a US and an Australian entity. The offering of digital virtual actuarial consulting into an insuretech, insurance, banking and investment sector overseas is unlimited. currently we’re an ABC consultancy – still self-funded. We’ve done that on purpose. now we are developing our platform, as well as our actual software and insuretech that the actuaries will use within insurance companies.

Insurance companies and banks all use software. We are now moving towards being a software as a service. We’re developing that software, which is going to allow us to scale. We understand the consulting process now and we have actuaries all over the world.

Now it’s a matter of being a software business – that allows us to not just be a software business – but also be the man and woman power to be able to implement that software inside our clients businesses. What we call our – kind of like your annuity revenue type model to be able to scale. We’re building a scalable exponential business.  

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