Collage raises $5 million from Diagram to sate insurance industry’s appetite for digital solutions

Collage

“Our thesis is that all small businesses should have benefits.”
 

It’s a simple thesis, but one that’s driven by what Toronto-based Collage CEO and co-founder Elijah Moore calls an “attitude shift” in modern business. A new focus on healthy and positive company culture has led to the functions of human resources becoming unbundled and spread throughout organizations.

“More companies are saying, ‘hey, it’s not up to HR to schedule one-on-one meetings, it’s up to the manager,’” said Moore. “How do we use tools and tech processes together to make HR more of a participatory thing across organizations, rather than something that’s commanded from the top for them to follow?”

Collage’s platform attempts to provide the connective webbing for the unbundled workplace, tackling both HR and benefits management for small businesses. Today, the company announced a $5 million funding injection from Power Financial-backed VC Diagram to help accomplish its goal.

READ: Collage believes taking care of your employees should be easy

With the founder of pension and benefits brokerage PDF Financial Group on its co-founding team, Collage is also a registered insurance broker in Ontario, and is working on being licensed throughout Canada.

“It was clear from our initial meeting that the experience and vision of Collage’s founding team was something that gave them a massive step up above the others. Many founders within this sector are in the game to capitalize on this gap within the industry but don’t truly understand it,” said François Lafortune, CEO of Diagram. “Knowing that this team of founders and a long-standing benefits professional live and breathe the space made for an obvious and strong investment for Diagram.”

The company offers advice on quoting and buying, as well as full integration with all major Canadian insurance companies. Companies already enrolled in benefits plans can have it transferred into Collage’s platform with no switching costs, and manage employee benefits plans online.

“We’re turning our focus now to working with the insurance industry more broadly, and we think there’s a real appetite to work with Canadian insurance companies to actually push insurance into the digital age,” Moore replied when asked about how Collage will use its new funding.

“We’re turning our focus now to working with the insurance industry more broadly, and we think there’s a real appetite to push insurance into the digital age.”

Moore credits Collage’s position to feed that appetite to its relationship with Diagram, which recently raised a $25 million fund from Portag3 and over 50 angel investors. Diagram supports companies in the FinTech, insurance, and healthcare space, and takes a unique approach to its investment thesis: making bigger bets on a smaller portfolio, then value-adding resources like recruiting, financing, and accounting. Moore said that Diagram was key to helping the startup scale its team; the company currently has 18 people.
 

“Diagram’s model is to commit more time and resources behind founding teams to give them the means to achieve their ambitions,” said Lafortune. “Since we started backing Collage, we’ve seen them achieve solid growth, secure key partnerships, and build new, innovative offerings to enhance the HR and benefits experience. There is still a lot in store for Collage in the coming months and we’re very excited for what’s ahead of them.”

READ: Diagram closes $25 million fund from Portag3 and 50-plus angels to build Canadian FinTech from the ground up

Conceding the company faces significant startup competition in the HR and benefits space — including Canadian benefits giant LEAGUE, which has also taken money from Power Financial — Moore said Collage will set itself apart by being an all-in-one platform that automates manual processes. “This is attractive to big partners. Those types of things level the playing field, even if we’re a small company dealing with a large one.”

However, Moore indicated that it’s the benefits side that will win businesses over.

“I think what’s hard to do is blend HR while pushing the benefits industry forward at the same time. There’s low hanging fruit on insurance side — startups can come and build a product and get to market. But we think that to create the best product possible, we have to really push innovation on the insurance side,” said Moore.

Over the next few months, the company is focused on developing more partnerships with insurance companies (it currently has a partnership with Montreal-based Dialogue, a virtual health app that allows employees to have live consultations with doctors via their smartphone, and also a Diagram investment). Moore said Collage also wants to explore other aspects of insurance.

“Can we use our ability to work with insurers and translate complex insurance terminology brokerage processes into great processes, and can we apply that to other insurance to succeed? We think the answer is yes.”

Jessica Galang

Jessica Galang

Jessica Galang is BetaKit's News Editor.