Q&A: Sam White, Freedom Services Group founder and chair

You filed the paperwork for Stella Insurance through Companies House in December 2021, but the official launch of Stella in the UK took place a year later in December 2022. How has it gone so far?

It has gone better than I could ever have hoped, to be honest. We are only a couple of weeks in, there’s loads more to do, and lots more to build out, but we are super-excited. The sales have been really strong. The marketing campaigns are really going to start to kick in over the next few months, and I’m hoping everyone gets bored of the sight of Stella.

It has gone better than I could ever have hoped, to be honest. The sales have been really strong."

We have also partnered with The Fly Anyway Foundation with Dani Wallace. When sales are strong, we’re building up a lot of funds to go over to Dani, and she’s going to use that money to help support victims of domestic abuse when they are launching their own businesses.

What can we expect from Stella’s marketing? Will it be an ‘in-your-face’ style of marketing?

Yes, absolutely, it will be in-your-face marketing. We’re not allowed to rate women differently, but that doesn’t mean we can’t build products that are designed around them, with women very much front and centre.

It doesn’t mean we can’t advertise specifically to them, and have advertising that relates to them. It doesn’t mean we can’t create communities that they’re also excited by. So for me, it’s about creating a community that women feel connected to and feel that they are represented.

You said, previously, at the launch of Stella in Australia, that it was a female-centric insurance provider, but there are rules and regulations around that in the UK. How have you navigated those regulations? Is the Stella brand slightly different in Australia from what it is in the UK, or are you trying to keep the businesses as closely aligned as possible?

The only difference is pricing. The only thing we’re not allowed to do is offer a different price to a male or female customer; everything else is the same. We have male customers in Australia, so we’re not saying that we won’t insure men, what we’re saying is that the product has been designed from a female perspective.

The insurance industry is incredibly male-dominated. Pretty much everything else will have been designed from a male perspective, just by default, because that’s where the senior leadership has been. So, the fact we’re designing it from a female perspective will hopefully appeal to women more.

Pretty much everything else will have been designed from a male perspective, just by default. So the fact we're designing it from a female perspective will hopefully appeal to women more."

There are also different things in the UK that will be appealing to people, and we’ve tried to factor that in.

When you first launched in Australia, you spoke to Insurance Post, and gave yourself a target of £80m in gross written premium a year after the first five years. That was two-and-a-half years ago, so we are at the halfway point. Are you still on course for that target?

That was just for Australia, and it is on target to hit the gross written premium for which they were planning. Albeit, we have moved into other products areas slightly later than we might have hoped. So we’ve stopped with just motor insurance, and are now moving into pet insurance. We will be launching a travel and home product as well both in Australia and in the UK.

What does this mean for your role at Freedom Services Group? You were the founder and CEO, but have since stepped back and taken on the role of chair. Will you end up stepping out of the Freedom Services Group altogether?

That will depend on the team. I have been quite open about the fact that the management team would like to do a management buyout to buy the majority of the shares off me. But they’ve all been quite clear that they would also like me to stay on as chair as a supportive element to the business, albeit not being as hands-on as I have been over the past few years.

I’m hoping that it doesn’t make any difference to the relationship we currently have because, obviously, I’ve already started to hand the reins over to CEO Andrew Tailby on a day-to-day basis.

How have you found stepping back from Freedom Services Group?

I have loved it. We’ve got a really great executive team that are increasingly becoming more empowered and are moving the business forward. They’ve managed to launch some really great initiatives this year, such as the four-day working week, which they’ve now made a permanent thing.

The group are doing some really exciting things, and owning it themselves and moving it forward. So, it has not been a challenge at all to go through that process.

Freedom’s GWP was around £87m in 2019, and then it slumped to £30m during 2020, but picked up again in 2021 to just under £64m. Turnover followed a similar pattern, but earnings before interest, taxes, depreciation and amortisation continued to decline. In 2019, Ebitda was just shy of £4m, then in 2020 it was around £1.2m, but in 2021 it was less than £1m. Is that a concern for you?

I have to hand it to the guys at Freedom. They've smashed it out of the park and they'll do £100m GWP this year, so it is a real recovery."

We have made a massive recovery to Ebitda this year. It is going to come in at around £5m, and they have done a great job pulling it back.

I was quite open about the fact that we had substantial challenges during the Covid-19 pandemic, and it was a real fight to pull it round.

I have to hand it to the guys at Freedom. They’ve absolutely smashed it out of the park and they’ll do £100m GWP this year as well, so it is a real recovery.

You’re seeing GWP and turnover back to pre-Covid-19 pandemic levels?

In advance of. From an Ebitda viewpoint, they have done substantially better than they did in 2019 thanks to new capacity, relationships and new products. Also, telematics is going really well for them.

Going back to the £18m GWP target for Australia, have you got any targets for entering the UK?

For the first year, our targets are quite conservative at probably £10m GWP, but it ramps up quite quickly, and over the five-year period we’re going to be aiming for £300m in premium. I can’t see any reason why they can’t achieve that based on what we’ve seen so far.