Extend raised $16.4 million in its first funding round led by GreatPoint Ventures in conjunction with the deal with Aon that brought a senior vice president at the established $46-billion insurance company to Extend’s team. The San Francisco-based startup now owns assets that administered Aon’s warranty programs in the U.S. It has deals in place with more than a dozen merchants that collectively have $11.5 billion in annual sales to build application programming interfaces (APIs) that allow them to offer extended warranties on their products to customers.
Extend is too late to the game to start at the top. Levin says the biggest online retailers like Amazon, Apple, Walmart and Costco already have interfaces in place to sell warranties, usually one-off integrations built by a multibillion-dollar fintech company like SquareTrade or Assurant. Instead, he wants to guide his startup to a similar level by making the market accessible to smaller companies, even if he doesn’t attract the most recognizable names in e-commerce.
“We want to build a brand that gives you an AppleCare-like, delightful experience with us,” Levin says. “The goal is absolutely to build a multibillion-dollar company too, and retailers outside the top 1% are so underserved that we don’t feel we generally have to compete with the big players to get those deals.”
A serial entrepreneur, Levin has founded startups in industries ranging from sports advertising and gaming to online document storage and cryptocurrency investing, selling one of his companies to DocuSign in 2015. When he was playing a head-to-head fantasy football contest against friend and DraftKings CEO Jason Robins last December and lost $150 due in part to a leg injury that sidelined Pittsburgh Steelers running back James Conner against the Los Angeles Chargers, his mind started churning again.
“I really started examining it when I got pissed off enough to try to find a solution to me losing money,” Levin jokes.
He soon decided the idea of fantasy football insurance was more of a fun hobby than a realistic scalable business—though there are several choices that do offer protection plans to fantasy fanatics—but broadened his scope when he felt that there was untapped potential in e-commerce insurance and launched Extend in 2019.
Extend has built integrations that allow merchants to offer extended warranties through most common e-commerce platforms like Shopify or Magento and offers custom-built APIs as well. When Levin says Aon was having trouble developing the technology for point-of-sale integration, he jumped at the opportunity to acquire its back-end administrative experience and take its plans to the market right away. Terms of the deal were not disclosed.
It won’t be easy for Extend to grow, and Levin did not reveal its revenue for 2019. Other startups like Clyde, Upsie and Mulberry that offer similar services have cropped up in the last couple of years. But Extend has started its push in the arms race to onboard as many merchants as possible, landing deals with home security provider August Locks, power equipment manufacturer Cub Cadet, cleaning kit seller SoClean and more than 10 other assorted retailers. SoClean chief investment officer Keith Brown, whose company had never offered extended warranties, cited Extend’s association with Aon as the deciding factor in its deal.
“The merger between the Aon capabilities and the Extend technology with what they bring to the table just makes them a really strong team,” Brown says. “If you’re going to add an extended warranty, different states regulate that differently, and having a partner that comes to the table that already has met those licensing obligations was far less complicated.”
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