San Francisco home insurer Stand has raised a $70 million Series C at a $1 billion valuation, Fortune reported exclusively. Stand prices wildfire risk by building a digital twin of each individual home rather than grading neighborhoods by zip code, and says it now insures more than $10 billion of property, up from $1 billion a year ago.
The company says its digital twins predicted wildfire outcomes about 85% of the time in a backtest, compared with 50%-55% for conventional models. CEO Dan Preston told Fortune the business is growing roughly 15% a month, and it has done so in only two states so far: California for wildfire and Florida for hurricanes.
Inside Stand's digital twin wildfire model
Stand's chief science officer, Matt DiStefano, demonstrated the technology for Fortune by rotating a gray 3D model of a California neighborhood and overlaying a heat map. Red contours traced the sides and back of one house where trees stand close to the structure, while blue sat near the pool. Deleting a single tree cut more than $1,100 a year from that home's premium; another tree, he said, contributed far less.
DiStefano's critique of the insurance industry is that a zip-code score works like a credit score: homeowners can do nothing to move it, and insurers can barely tell apart two homes on the same block, he said. He compared a windowless brick bunker with nothing around it to a wooden shed with a thatched roof, noting that a location-based model treats the two alike.
Stand's answer is to simulate what would happen to a specific home if a wildfire or tropical cyclone occurred, accounting for the home's materials, the arrangement of trees and wind direction and weather conditions. DiStefano spent years in aerospace, at companies ranging from Boeing to small Y Combinator startups, building models of circuit boards and satellites and simulating how they would behave in orbit.
- Raise: $70 million Series C at a $1 billion valuation
