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Chris Lotz of Goodcover: “Always have enough cushion and understanding of what your plan B’s are”

They say that CEOs have two jobs. The first job is to hire people smarter than you and the second job is don’t run out of money. Always have enough cushion and understanding of what your plan B’s are. The second thing you need is people to share it with. This is probably a standard thing, […]

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They say that CEOs have two jobs. The first job is to hire people smarter than you and the second job is don’t run out of money.

Always have enough cushion and understanding of what your plan B’s are. The second thing you need is people to share it with. This is probably a standard thing, but good co-founders reinvest in relationships outside of work because you’re going to need them. I think the third thing is the thing we’ve been mentioning before is an honest conviction of what you’re building. Whatever you’re working on — there are going to be good times and bad times. But having the vision keeps you all the way cooler.


Being a founder, entrepreneur, or business owner can have many exciting and thrilling moments. But it is also punctuated with periods of doubt, slump, and anxiety. So how does one successfully and healthily ride the highs and lows of Entrepreneurship? In this series, called “How To Successfully Ride The Emotional Highs & Lows Of Being An Entrepreneur” we are talking to successful entrepreneurs who can share stories from their experience. I had the pleasure of interviewing Chris Lotz, CEO and Co-Founder of Goodcover.

Chris has spent a decade in the insurance business working in New York, Singapore, Australia, and San Francisco. At AIG he worked on personal insurance for clients all around the world. Chris is an insurance nerd who’s passionate about making insurance work better and be accessible for all.


Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?

I’m an insurance nerd. I got started at AIG right in time for the financial crisis. I was fortunate, AIG sent me to Singapore at the age of 22 with the task of starting the watercraft business in Asia. The region was taking off at that time, learned everything from scratch — the whole business, the ways it worked, and all the ways it didn’t. I then went on to handle all of Asia Pacific from Sydney, Australia, and then landed in San Francisco with an idea.

The cardinal sin or original problem of insurance is that insurance companies make money when their users don’t get money. Fundamentally, these interests of the insured and insurer are misaligned. That is the core of why customers have a negative experience.

So I was asking myself how can this industry ever deliver a positive experience.

Incentives of a business matter — I pitched this idea for a while. Could we bring the cooperative model — the way insurance originally started — into the 21st Century. We can make money on the idea that we take a fixed fee and serve people, but don’t make money on whether or not they have claims.

I came back to SF in 2016 with the goal of getting something started. I met Dan, my co-founder. He was looking for ways technology can help disrupt archaic industries — so we decided to start an insurance cooperative for the modern era.

Goodcover was born. We got into Y-Combinator in early 2017 with just two people and an idea (and one baby each with more on the way.) We focused on getting filings going — products and pricing, etc. The idea gained steam, we raised a seed round, we signed partnerships, built technology, filed it with the State, and structured our business processes. And eventually, we were able to launch Goodcover renters insurance in February 2020 and it’s been a bit of a rocket ship since then.

What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?

The “Aha Moment” for us was watching how the industry sets up claim departments — most of it is designed to simply protect the insurance company — and why is 50% of the dollar we are collecting going to administrative expenses? That’s a lot of waste. I started looking into the history of the insurance business and the cooperative model which is actually how it started. People would pool their money together in an effort to protect each other — then there was usually a manager that took a fee for helping them manage it all.

This archaic system simply was not scaling into the 21st Century. Ultimately, the question was could we make insurance that people love because it works in their best interests.

In your opinion, were you a natural born entrepreneur or did you develop that aptitude later on? Can you explain what you mean?

Being an entrepreneur takes a lot of doing and I don’t think anybody is a natural-born entrepreneur in the sense of what it takes to actually leave comfort behind and start on your own. I had a 1-yr old, had just gotten a mortgage, all the traditional anchors that scream don’t jump into your own thing.

But I’ve always wanted to do my own thing, so I did. Now I had no paycheck for a year. I am fortunate to have a lot of support from a lot of people who believed in this with me and were able to help me for the really tough time to get it going.

Was there somebody in your life who inspired or helped you to start your journey with your business? Can you share a story with us?

Yes, my dad is actually an entrepreneur. Also in the insurance space — in catastrophe insurance. My father-in-law also started his own business. So, obviously, I had all these people that I saw that could go out and do this. It is a privileged position to be able to start a business. I thought this is doable. But I didn’t really understand what it took. But when I was examining my own journey, I knew I’d rather work for myself.

What do you think makes your company stand out? Can you share a story?

We’re about half the price of the existing market for renters insurance and that comes from a combination of good technology, a business model that’s actually good for our members, and all the efficiencies that come along combining those together. That means we can offer a good policy for a very low price and still get people what they need online digitally.

Fundamentally we need to understand why people are getting Insurance in the first place — trust you’ll be there for them in time of need. You know, we still have a phone line. I answer support chats, too. We need to be there to help people understand what they’re getting into. 70% of the people who sign up with us have never had insurance before.

There’s this huge wave of people coming into the market that needs insurance. You could go to any other brick-and-mortar agency and get an annual policy for 200 dollars and have to call somebody every time you have a question or want to make a change. With us you can get it for 5 dollars a month online in a hurry and still be able to reach support and do all of that on your own.

For example, we have situations where people made mistakes on their policy. They start chatting with us in the middle of the day — “I’m here. I need to pick up the keys for my apartment. But I made all these mistakes on my policy and the landlord won’t accept it. Now, what do I do and say?” We are able to get the details and boom make the change instantly and it’s already in their email so they’re able to pick up their keys.

You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?

  1. Willingness to be wrong: The most important trait is something I’ve had to develop over time, but it has become a willingness to be wrong. You’re going to learn a lot of things very quickly and you’re going to think there are a lot of things that are the way they’re supposed to be.
  2. Empower your colleagues: Another thing that you entrepreneurs can tend to do is to want to hold everything to yourself. You have to empower your staff to perform.
  3. Have honest conviction: Lastly and most importantly I think you need to have an honest conviction about your vision. If you don’t have conviction about what you’re doing, nobody else is going to believe you and you’re not going to stick it through the tough times.

Often leaders are asked to share the best advice they received. But let’s reverse the question. Can you share a story about advice you’ve received that you now wish you never followed?

Yeah, this is a good question.

It seems like people tell you to fail fast. I definitely didn’t take that advice. We subscribe to the opposite advice, which is don’t die.

Sure, fail fast in experiments — but the willingness to learn doesn’t mean you have to start and shut companies every five minutes. If you have a vision about something don’t fail fast. Don’t die. Y Combinator companies rarely died by that — companies primarily only die by suicide.

Which tips would you recommend to your colleagues in your industry to help them create a work culture in which employees thrive and do not “burn out” or get overwhelmed?

You know, raising three children under the age of five, I believe I could be burning myself out. But not burning out — we just have to make sure that people have lives outside of this and this all has to fit together. Being flexible in that environment is very important. That means you have to show flexibility as well. I pick up my kids from school and that’s good.

People get burned out quickly if managers are constantly breathing down their necks. I think in my mind there needs to be a good balance between Direction, what are the KPIs and one of the things that are going to drive the business forward. Letting people build operational plans to get that stuff done. I don’t micromanage my goal but rather empower people to have responsibilities. When people have responsibilities that they can achieve, that’s when they feel good about what they’re doing.

What would you advise other business leaders to do in order to build trust, credibility, and Authority in their industry?

The very short answer to this in any industry or anything you’re doing is … to do what you say you’re going to do. That’s the only real continuous process of building trust credibility or any authority at all.

Can you help articulate why doing that is essential today?

Why is doing what you say you’re going to do essential today? An investor once told me: “Chris, you’re doing what you say.” You’d be surprised how rare that is for any business. It is very simple, but it stands out.

What are the most common mistakes you have seen CEOs & founders make when they start a business? What can be done to avoid those errors?

I do see people starting businesses without the conviction of why they’re doing it, rather because it’s going to make them money. Or if people pivot into something they believe in, great, but also much of the opposite is true if they end up casting around for any old thing.

I was in Y-Combinator which enabled us to get the advice in this department. If you’re not in YC or an accelerator or some sort of thing, get some professional advice in this department. Because all this financing and who owns what of the company and how it’s documented and all that sort of stuff matters disproportionately down the track.

Ok fantastic. Thank you for those excellent insights, Let’s now shift to the main focus of our interview about How to Successfully Ride The Emotional Highs & Lows Of Being An Entrepreneur. The journey of an entrepreneur is never easy, and is filled with challenges, failures, setbacks, as well as joys, thrills and celebrations. Do you feel comfortable sharing a story from your own experience about how you felt unusually high and excited as a result of your business? We would love to hear it.

Part of the reason is you’re always going to see the inside of it and you’re always going to know what’s working and what’s not working. You know just how close you almost came to failing. Just how far away you were. Ultimately the buck stops with you.

You stopped a lot of things to jump into this and do this. In large part, it is an extension of your own identity so it’s a reflection of these highs and lows and feelings of success or failure. So it really amplifies whatever excitement or distress you feel about these things.

Do you feel comfortable sharing a story from your own experience about how you felt unusually low, and vulnerable as a result of your business? We would love to hear it.

Some great advice I got long ago was one of the best ways to feel better about how you’re doing is to stop screwing up. So amazing how the practical matters. I also do meditation. I’ve been doing it for years. I have three young kids, a great family, I invest in those relationships.

So, a large part of this is managing your own energy on things within your control.

A clear high was when we got off and running and launched our first product to the market in early 2020.

But there are lows as well — for example, we had to let an early employee go and that was a big low. We’ve had a technology break that needed to get fixed immediately and we’d have everybody drop everything to fix it. We’ve had Partners upset with us. We’ve had members upset with us — you have all of those things and they’re all so very personal.

Based on your experience can you tell us what you did to bounce back?

I always go back to the advice — the best way to do things is to stop screwing up and just acknowledge that you’ve been screwing up and move on right and start doing a better thing. For some of the things where there’s nothing you can do about them, it really is about understanding your limitations of control.

Ok super. Here is the main question of our interview. What are your “Five Things You Need To Successfully Ride The Emotional Highs & Lows Of Being An Entrepreneur”? Please share a story or an example for each.

They say that CEOs have two jobs. The first job is to hire people smarter than you and the second job is don’t run out of money.

Always have enough cushion and understanding of what your plan B’s are. The second thing you need is people to share it with. This is probably a standard thing, but good co-founders reinvest in relationships outside of work because you’re going to need them. I think the third thing is the thing we’ve been mentioning before is an honest conviction of what you’re building. Whatever you’re working on — there are going to be good times and bad times. But having the vision keeps you all the way cooler.

The next is the attitude that you should work on what you can work on and let go of the things you can’t control. Some people would call that stoicism, for some people it is mindfulness or whatever. But the basic fact is to let go of what you can’t control and focus hard on the stuff you can and know the difference.

Try not to suck. Don’t try not to die. People need to have something that matters outside of work.

We are living during challenging times and resilience is critical during times like these. How would you define resilience? What do you believe are the characteristics or traits of resilient people?

Characteristics or traits of resilient people actually have basically those five things we talked about such as having enough resources or knowing where to get them to be able to not die. Focusing on stuff they can do and have a network that supports them emotionally outside of work.

I know people who fail in their resiliency primarily when they let one of these five things get out of control and it takes over and sabotages everything else.

Did you have any experiences growing up that have contributed to building your resiliency? Would you mind sharing a story?

Yes. This is I tell the story a lot actually — I grew up sailing and racing boats with my family. We were three siblings and two parents and so we basically made up the whole crew. Through those experiences, we competed together and worked as a team. We were focusing on what we each could contribute. We all understood the vision of how we wanted to succeed. We each had each other and we’re a family on and off the water. The success of that really gave me a lot of insight into how to make it.

We won a lot, but my parents were also great failures. And so, we listened, and we were good kids and did our work. It was good instruction for me about how a unit can work and succeed in that way. And so, you know, we didn’t win all the time either, but those things support us through that process. So, I think losing out builds that resilience, as well.

In your opinion, do you tend to keep a positive attitude during difficult situations? What helps you to do so?

I don’t know whether I’ve always been a reasonably optimistic person, but I don’t know why I’m like that. I definitely learned to be more mindful about this whole thing — understanding what it’s in control and letting go of the things that aren’t, which is kind of a critical way to like.

My meditation has had a big impact on my ability to see my own emotions clearly. It’s basically just the process of learning to understand what’s going on in your own head and body and feelings. So, it’s a useful practice. Yes, and hopefully it provides a little bit of self-awareness there.

Ok. Super. We are nearly done. What is your favorite inspirational quote that motivates you to pursue greatness? Can you share a story about how it was relevant to you in your own life?

The Golden Rule — Treat others the way you would want to be treated. Period.

How can our readers further follow you online?

@chrisplotz

Goodcover.com

@Goodcover

This was very inspiring. Thank you so much for the time you spent with this. We wish you continued success and good health!

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