Inside Project CAP – one stealthy venture funded startup

Project-CapConsumer Agent Portal, aka Project CAP, first arrived on the scene back in the summer of 2011 when they quietly raised $18m to develop a means of saving the independent insurance agent via lead gen marketing platform.

A year later, and still without much of a peep, they banked another $6.6m followed by $10m.  Add $6m more and $10m last month…what do you have? ~$50m in funding over five rounds. 

To think that there are startups with $100k in funding that have more fanfare and notoriety than CAP is baffling.   Years later, we’ve caught up with them to hear more; while CEO Charles ‘Chip’ Bacciocco wasn’t available, we met with Tony Tellijohn (TT) – Director of Marketing, Wade Anderson (WA) – VP of IT and Warren Lochner (WL) CFO & COO.

What are the basics of the business? 

WL: Consumer Agent Portal (also known as Project CAP) was formed in January of 2011 through funding from the IIABA and six initial carriers. We’re headquartered in St. Louis Park with some of the management team in Milwaukee and we have about 35 employees now.

Why Minnesota?

WL: That’s a good question.  None of us here today are part of the original management team and that decision was made prior to us arriving.  Perhaps it was because that’s where the original contractor was sourced from.

When and how did each you come into CAP?

WL: In April 2012 when revenue started I came in as the CFO and eventually became COO as well.

TT: I joined in June 2012…originally came in to be a search engine strategist for, which is the consumer half of the business. As we’ve continued to grow, I’ve been doing traffic generation and overall marketing for CAP as a whole as the marketing director.

WA: I was brought in around mid-December to take on and lead the IT function around software delivery.  A lot of the original build was outsourced and we’ve since added local partners in Minneapolis and Chicago.  We wanted to own our own destiny through a better architecture with a more agile approach to scale.

So what exactly does Project CAP do?

WL: is the consumer facing half and is the other side for independent insurance agents. Under ‘Trusted Choice’ consumers seeking insurance in any number of areas could be matched with agents offering various policies or carriers.   We’re a resource center for these consumers and digital solution for the agents who offer insurance.

Why Project CAP?

WL: To preserve the independent agent channel, the IIBA wanted to get these folks into a common marketing platform.

What is the size of this marketplace?

WL: It’s big. I don’t have the figure on the top of mind. There’s some 300k agents and 20k independent agents domestically.

Who or what do you compete with?

Direct carriers who advertise on TV, radio, print and online…Geico, StateFarm, AllState.  Even traditional web agencies that operate in the insurance vertical.

Has the company really raised $50m?

WL: It is in the ballpark of $50m

Who are the investors behind it?

WL: There are technically nine investors. The IIABA, and then eight investor carriers (the original six, plus two more recently). Those eight carriers are (in no particular order) The Main Street America Group, State Auto Insurance, Westfield Insurance, Travelers Insurance, Motorists Insurance, Central Insurance Companies, Selective Insurance, and Safeco Insurance.

That’s not an insignificant amount of money…what has it been applied to?

WL: A lot of it has gone into technical portal development and other digital products

I had read that there was a delay in launch, can you speak to that?

WL: Yes…there was supposed to be a launch earlier in 2013 but there were delays that caused us to come out later in the year.  I think that with a project of this size those things can happen.  We’ve launched now, stabilized and are in the market.

WA: We did have those challenges out the gate due to the outsourcing…but through bringing it back in and realigning, we’ve tripled the output as a software delivery team.

TT: We’re still learning.

Is the product fully commercialized now?

WL: Yes

And how’s it going?

WL: Going well now. We’ve seen subscription growth and month over month sales.

TT: On the side of things, just from a traffic side of things, we’ve had nine consecutive months of record traffic and we’re seeing 1,000%+ year over year growth.   Both from the consumer awareness side and the agent participation, things are going extremely well.

How do you make money?

WL: Subscriptions for agents to be on the platform and additional products

What do you see as your current traction/position relative to the overall market potential?

WL: We maybe have 2% right now and a ways to go.

TT: Agreed, it is low, but it’s coming from nothing and going in the right direction.  At the end of the day it’s difficult to measure because we aren’t the ones selling insurance.

What’s the long term plan?

WL: Our investors have bought in for the long haul…at least for the next 5+ years it will stay private.

Anything else you’d like to add?

WA: We’re starting to let ourselves be seen now and there’s good talent here in the Twin Cities.


  • Mark Gritter

    When the answer is basically “I don’t know”, I think it would be fair to leave that question out of the published interview. :)

    You tweeted this as “venture-funded” but it looks like all the investors are insurance companies or organizations. That seems more like a joint development company, since the insurance companies are doing this to benefit themselves and their agents, rather than hoping for a direct return on investment.

    • Jeff Pesek

      Hi Mark, which question are you referring to re. ‘I don’t know’ – the market size one?

      You’re correct in that the investors are various insurance companies. Not sure that there’s a clear concrete definition of what venture funding is or is not – but I could be wrong? It’s still a venture (to start to do something new or different that usually involves risk) with funding (money provided, especially by an organization for a particular purpose). That’s where I was coming from, but I can also see it considered a joint development effort.

    • Casey Allen

      In some ways it feels like they got their initial customers to fund the development and launch of this which is pretty amazing considering the dollar amounts at play. It means they had an astonishingly high valuation out of the gate.

      It should be noted this is not directly to help the insurance companies. This is all about the agents that sell the insurance. In a way agents and the insurance corporations are competing for the same customers. The insurance companies and agents have been at war for years. Corporate doesn’t need them for distribution anymore and would like to own the customer relationship, but independent agents are hanging on to stay relevant and to find ways to acquire customers online.

      Either way, this is like a Hulu (started by Fox, ABC, and NBC) and Orbitz (started by United, Delta, Northwest, and Continental Airlines). It’s what players that are becoming disrupted do to play defense, which is arguably better than nothing.