Block Kong is a series of interviews with blockchain-related entrepreneurs and financiers in Hong Kong, brought toyou by Charles D’Haussy.
With 20 years of wealth management and insurance under his belt, Mark Wales certainly knows the industry. After working at ING, Cap Gemini and Deloitte, he co-founded one of the earliest fintechs in Hong Kong, Galileo Partners.
It is now a leading blockchain-based company in Asia’s insurance industry, having recently raised a $2 million Series A round led by Nasdaq-listed Greenlight Reinsurance.
We agree to meet for breakfast at the Cupping Room in Sheung Wan, as it’s one of his go-to coffee venues near his office. Sheung Wan is a district where many entrepreneurs get their start, including me. I’m hoping that we find enough room for Mark to demo the latest upgrades to Galileo – the last time I saw it was 2016, making it among the first complex, live demos on Ethereum Quorum that I experienced.
Wales has beaten me to the café, and is already sipping an orange juice. He’s in startup gear: black jeans, light blue shirt, Apple watch. The salt and pepper in his hair says more about his experience in technology than it might about any lost nights during last year’s crypto-market bust.
He orders a flat white and a croissant, while I stick to a simple English Breakfast tea.
Galileo is a B2B technology company building a platform to connect all participants in the insurance business. The idea is to both streamline reconciliations and create a single source of truth in the life of a policy transaction.
How did it start? While at Deloitte, a colleague pitched him the idea of a peer-to-peer network for insurance. He quit three months later to join his co-founder, Annette King. But very quickly, they realized that regulation in Hong Kong would not support a P2P business model. The partners pivoted to a B2B model.
“We cover the full insurance business lifecycle,” Wales says. “It’s a more complex industry than people think.” There are a handful of other blockchain-based startups in the insurance space, including PolicyPal in Singapore and Blocksure in the U.K.
Streamlining operations is one thing. But what’s so important about a single source of truth? “Better U.X. [user experience], and massive savings for the company,” Wales says.
Working with insurance companies must be a struggle, I suggest. They aren’t exactly known for their speed and flexibility. I ask him whether he can tell when a project might end up going nowhere?
Wales has been here before: “The industry breaks down into two categories,” he says. “The first are the people who say, ‘We knew this was coming,’ and they need to catch up. The second are those who say, ‘I don’t need this, I don’t see the value.’ What they’re really saying is that they don’t want to upset their brokers or agents, who might think blockchain is out to replace them.”
But even with insurers that understand they need to upgrade their business models, it’s not easy: “Insurtech has probably the longest sales cycle in the fintech industry.”
Wales is optimistic, though, because he sees even the naysayers coming around, particularly in Southeast Asia, where the market’s growth prospects are big.
There’s increasing competition but the winners will be those that can add new business at scale – which insurers today can’t do, because of their systems architecture. Galileo is selling primarily to second-tier insurers that have a shot at winning at scale against tier-1 competitors still laboring under outmoded tech.
“Blockchain is simply more efficient, simpler, and cheaper,” Wales says. He has grown more animated. Clearly he gets excited by technology.
Is he focusing more on Southeast Asia because of competition in North Asia from giant Chinese fintech companies? After all, these “techfins” are promoting B2B technology and platforms to insurance companies and banks.
“Nah, I’m not that worried about them,” Wales says. “Clients might not be comfortable running their business on a competitor’s platform.”
I steer the conversation back to Wales as a person. I tell him I understand he used to be a competitive runner.
Wales says he stopped running three years ago due to a hamstring injury. “But I remain competitive,” he says. “More competitive than people imagine.” What is it about competition that matters to him? “It’s simple: I don’t like to lose.”
What’s winning, though? What does that mean?
“Second place is the first one to lose,” he replies.
When he looks at the insurance landscape, what’s winning now?
Wales says he’s pleasantly surprised by the industry’s new willingness to try many new products. “Some of these products, like those with dynamic pricing, are really clever,” he says. I ask him for some examples from the incumbents, but he defaults to another startup: “Sherpa in the U.K., providing insurance for the gig economy.”
Given his blockchain focus, does he own cryptocurrencies? “Not at the moment,” he says. “I got in way too early.” He says the public’s mindset of “crypto craziness” is blinding people to what’s really happening in the city’s blockchain scene. “People do need to know about the better tech stories out there.”
But consumers, whether they know it or not, are getting integrated into blockchain platforms by the businesses serving them. Maybe, soon, for their insurance needs, too.
The Cupping Room
- 299 Queen’s Road Central, Sheung Wan
- Orange juice, HK$48
- English Breakfast tea, HK$45
- Flat white, HK$40
- Croissant, HK$20
- Total: HK$153 (US$19.62)
- Paid via Octopus card