Digital nomads, an untapped market source

Digital Nomads

writer icon Joachim Avoja     Adrien Be   |   Startups     🕐 09. Apr. 2018

Y Combinator is a company that helps startups by investing in them early. Twice a year they have a demo day where they unveil a collection of new companies. On 19 - 21 March they had the first demo day of 2018. One of the companies to be unveiled there was SafetyWing. They have recently received an investment of $500 000 from Innovasjon Norge and The Nordic Web Ventures.

SafetyWing is a company, originating from Norway, which offers insurance for digital nomads. So far there has not been a sure way for digital nomads, or other, similar remote workers, to get a safety net by being insured. SafetyWing saw a market opportunity in this and decided to create this net themselves, finding a way to turn digital nomads into a viable way to make money.

Before SafetyWing, digital nomads would generally have to look for insurance that applied to people who travel, so they would have to turn to companies such as Cigna or IMG Global. Companies that were never specifically aimed towards digital nomads. That is where SafetyWing comes in. Since they also describe themselves as digital nomads, they claim to be able to offer insurance that is more tailored to what someone in that situation would need.

Some of the benefits that SafetyWing offers are emergency medical treatment, lost luggage, travel delay, medical and political evacuation in the event of political disruptions or terrorism events, and accommodation replacement in the event of natural disasters. They also offer personal liability coverage for injury or losses to third-parties. Their insurance does not, however, cover routine checkups or preventive care. Digital nomads can sign up for this for an additional cost per month, with that particular cost being higher if the insurance taker works with the US.

Digital Nomads
A digital nomad is someone who uses digital or online tools to work, and are not bound to one office or location. They work from wherever they choose, and are essentially ‘location independent’. A lot of digital nomads work from home, libraries, coffee shops, and even cars. Due to the nature of how they conduct their work, they are rarely tied to any specific company or workplace. There has been a lack of simple, concrete options when it comes to insuring their mobile workplace, an insurance which so many other workers take for granted.

Digital nomads can work within several different areas. They may be a freelancer who does coding, or one who writes articles and works with social media. They could also be entrepreneurs who manage their company through online tools. A digital nomad could even be someone who works for a more traditional company but does their work remotely rather than in the actual company space, allowing them to make their own schedule.

Y Combinator and their demo day
Y Combinator provide seed funding for startups. Seed funding is what you call it when you invest money in something at the earliest possible stage. With that money, startups can pay their expenses when they are just starting out. On their website, Y Combinator explains that they want to help companies get through the ‘first phase’. This means that they want to help the company get to a point where they can start making a profit themselves.

Twice a year, they invest in a small selection of companies. They do this in batches, from January to March and from June to August. The companies they choose to invest in are presented at the ‘Demo Day’. This is an opportunity for the latest group of Y Combinator-funded companies and their founders to present what they do, and what products they offer. This takes place over three days, the last of which is Investor Day, where companies gets to meet with investors.

Besides SafetyWing, a number of other companies were also unveiled during Y Combinator’s Winter 2018 Demo Day. Callisto is a sexual misconduct reporting software built for victims. Bump is a peer-to-peer streetwear marketplace. The One Health Company want to improve the treatment of canine cancer, while Onederful provides an API for dental insurance. Anjuna protects applications running in the public cloud. wants to standardise what they call the “visual language of biology and the software to communicate it.”. Then there is Airship, a feature flagging framework that lets small startups roll out products the same way the big tech companies do. Finally, Gainful is a company that makes personalised protein shakes, and Quantierra sources real estate investments for developers.

The future
Now that SafetyWing has made the world aware of the market opportunities that digital nomads can provide, it is going to be interesting to see if other similar companies will emerge. Maybe SafetyWing is going to get competitors in the form of other insurance companies? Competition in some form will almost certainly emerge, but the interesting thing will be to see what other kinds of marketing opportunities will turn up as a result of the shift in how people work.

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