Risk & Insurance
Relation’s Head of Software Interviewed by San Francisco Business Times
SF Biz Times Exclusive: Startup Zendrive to triple workforce at new San Francisco headquarters
Transportation data company Zendrive this month moved into a new office to expand its San Francisco operations and says it wants to triple its workforce here.
The company analyzes mobile phone data to predict driving behavior and helps insurers identify risky drivers. Its customers uses these analytics to manage their vehicles, drivers and liabilities.
Zendrive charges enterprise customers a fee per driver monthly and earns commissions through its insurance agency ZD Insurance Services, LLC. The affiliate acts as an agent for its insurance partners.
By using smartphones to track cars and driver behavior on the road, Zendrive works with insurance companies and transportation planners to lower their costs and collisions using data analytics. It is building out a new headquarters with 7,500 square feet on the third floor of 929 Market St. to triple its workforce. The company has 61 employees in San Francisco and Bangalore, India, with most of the anticipated growth here.
Distracted phone use causes a quarter of car accidents in the U.S., according to the National Safety Council. Zendrive said its technology and data can improve driver safety by collecting data on behavior, like speeding and hard braking, and phone use. The company said it is amassing data on tens of millions of drivers and tens of thousands of crashes but keeps the data anonymous and does not share with anyone.
These insights could affect how auto insurers set their prices and help transportation businesses learn more about what causes accidents, where they happen and types of drivers who cause them, Zendrive said. However, the startup said it doesn’t directly report data to insurance companies, and it cannot identify drivers, their companies or insurance from their data.
Zendrive has raised about $20 million in funding, backed by investors including First Round Capital and BMW iVentures. It was founded by Jonathan Matus and Pankaj Risbood in 2013 to focus on using data analytics to improve road safety. Matus, who spent several years at Google then Facebook working on mobile products, said he felt responsible for working on smartphone technology that added to people’s distractions on the road.
“I didn’t feel that was a meaningful use of the people around me and the use of my time,” said Matus, founder and CEO of Zendrive.
Smartphones were killing people, but they could also be used to save their lives, Matus said. So Zendrive has created a developer platform for companies to analyze driver behavior in order to prevent accidents and develop insight on their fleets.
Using smartphone sensor and GPS technology, it captures data around collisions, distracted driving and aggressive driving and then sends driver coaching insights and recommendations through its dashboard, an API, emails or text alerts. The app scores drivers’ performance and sets goals for them.
Zendrive said its driver coaching, which costs $4 per driver per month, can help reduce crashes by up to 49 percent, and the tool will get better as it accumulates more data. On average, the company analyzes more than 15 billion miles of data every two months, totaling about 50 billion miles so far.
That’s compared to Progressive Insurance, for example, which in 2017 reported collecting 15 billion miles of data over 18 years, Matus said.
“We’re going to hit 100 billion (miles) soon,” he added.
Zendrive will continue growing its team in India, which occupies a large building with two floors and will add two additional floors. The company has also been working with autonomous vehicle partners to research safety and road conditions in that upcoming market.
Using insightful data to determine prices has caught on in the business. Insurance company Metromile, also based in San Francisco, is using a small GPS device installed in customers’ cars to bill based on usage, and the company raised some $150 million in 2016 alone. It now has more than $200 million in funding, according to Crunchbase. It is available in seven states and expanding service to New York, Texas and Florida.
Tom Pataluch, director of software development at Walnut Creek-based Relation Insurance Services Inc., said these technological changes have enabled insurers and businesses to look beyond aggregated data, which traditionally included information like driving history and deductibles. Now they can collect more personal history and data in real-time to come up with more accurate rates.
“Data is becoming increasingly important. I can definitely see cases where it can help companies with fleets and the trucking sector to manage risk,” Pataluch said.
But not everyone will see savings on Zendrive. Rates are still tied to driver behavior: Drivers going slower on shorter trips will see rates go down, and drivers going faster over longer distances might see rates go up.
“It will lower the rates for some and increase the rates for others,” Pataluch said.
This article, authored by Antoinette Siu, originally appeared in the San Francisco Business Times on January 22nd, 2018.