Future Proof’s Pivot Playbook: How Overbuilding Their Product Led to a Better Market Opportunity

Future Proof’s Pivot Playbook: How Overbuilding Their Product Led to a Better Market Opportunity

Sometimes building too much technology can be the best mistake you’ll ever make. In a recent episode of Category Visionaries, Future Proof Technologies founder Alisa Valderrama revealed how creating an overly sophisticated climate risk analytics platform led them to discover a much bigger opportunity in insurance.

The Original Vision

Future Proof began with an ambitious mission: to translate climate risk into financial terms that businesses could understand and act upon. “We started looking at the impact of physical climate risk on property,” Alisa explains. “And our R&D team, led by my husband Alex, quickly realized that the best way to truly understand and model the impact of physical climate risk on real assets was to gather insurance claims and use AI on the claims.”

This technical approach was revolutionary – but not in the way they initially expected.

The Overbuilding Revelation

As they developed their analytics platform, Future Proof realized they had created something far more sophisticated than what their target market was ready for. “We had built a risk decisioning tool and a lot of folks in finance, believe it or not, were still mostly interested in an ESG type tool with qualitative risk assessment for climate,” Alisa notes. “We just kind of overbuilt, frankly for what the financial industry needed.”

This moment of realization could have been devastating. Instead, it led to a crucial insight: they hadn’t built the wrong product – they were just selling it to the wrong market.

Finding the Real Opportunity

The breakthrough came when they recognized that insurance companies were desperately seeking exactly what they had built. As Alisa explains, “Wherever insurers are not sure how to price the risk, they’ll usually choose one of two options – either they can charge exorbitant premium or they just choose to exit in an area or region where they cannot understand climate-related risk.”

Rather than trying to convince financial institutions to adopt more sophisticated climate risk analysis, Future Proof pivoted to become a Managing General Agency (MGA), using their technology to help insurance companies better assess and price risk.

Executing the Pivot

The transition wasn’t simply about changing their target market – it required rethinking their entire business model. Instead of selling analytics as a service, they became an insurance company that used their proprietary technology as a competitive advantage.

“We are not selling analytics into the market. We’re not selling a catastrophe model,” Alisa emphasizes. “We are using our own unique model to select and price risk on behalf of insurers and reinsurers.”

Validating the New Direction

To prove their value in the insurance industry, Future Proof worked with one of the world’s largest reinsurance brokers to test their model on 270,000 Florida addresses from past hurricane events. This validation created what Alisa calls “a proof point of, hey, had you been working with Future Proof for this past hurricane event, here’s how much better you could have done.”

The Bigger Picture

Looking ahead, Future Proof aims to transform how the insurance industry approaches climate risk. “In five years we’re in all 50 states with homeowners commercial insurance as well. We have differentiated insurance policies… and crucially, the Future Proof insurance policies have financial incentives for investments in resiliency built in,” Alisa envisions.

For founders, Future Proof’s journey offers a valuable lesson: sometimes your technology’s best application isn’t what you initially imagined. The key is remaining open to discovering where your innovation can deliver the most value, even if that means becoming a different type of company than you originally planned.

As Alisa reflects, “We’re in the right place at the right time… we’re working on one of the biggest and most high impact ideas I can think of when it comes to climate change.” Sometimes building too much of the right thing can lead you exactly where you need to be.