Exclusive: Flow Specialty cuts brokerage staff including Derigiotis in pivot to SaaS model

By James Thaler

May 27 - (The Insurer) - Munich Ventures-backed insurtech SME wholesaler Flow Specialty on Tuesday parted ways with its entire 12-strong producer staff including its brokerage president David Derigiotis as the firm pivots to a SaaS-based business model.

Flow Specialty was originally launched in 2021 as Capitola by Sivan Iram, Amit Ben Nathan, and Naor Rosenberg with an aim to match agents with carrier appetites and act as a wholesaler in select cases.

Last year the firm made a strategic shift to becoming a small commercial wholesaler when it rebranded to Flow Specialty, with an ambition to “transform the wholesale brokerage experience”.

Since its founding the insurtech has consistently touted vision has always been to bring tech innovation to make brokers “10 times better”.

Now in its latest pivot announced internally on Tuesday the company has determined that it can achieve that goal most effectively through a strategy where it plans to license its technology more broadly across the industry, after finding it challenging to scale its broking operations.

A spokesperson for Flow Specialty declined to comment on the workforce reduction and the company’s latest strategic pivot.

Sources with knowledge of the situation said Flow Specialty reached the conclusion that a producer-led wholesale brokerage model would be especially difficult amid the ongoing softening market conditions.

Sources familiar with the company’s thinking expressed confidence in its internally built technology and platformless AI model, designed to reduce the manual workload for individual brokers.

This past January the company announced that its AI model successfully passed RPLU certification exams for cyber, errors & omissions, and executive liability modules.

Sources said 12 roles were impacted by the reduction-in-force on Tuesday, after the company’s headcount peaked somewhere in the “high-20s” of staff.

Brokerage president Derigiotis is the most well-known executive leaving the company, having joined the firm in April 2024 after spending a year as president of embedded-focused insurtech Embroker and a 14-year career at family-owned wholesaler Burns & Wilcox.

He was previously a professional liability underwriter at Argo and Markel.

Sources familiar with the matter said Flow doesn’t plan on fully shutting down its brokerage operations but plans to adopt a different model where it intends to remain a licensed broker.

The insurtech raised a $15.6 million Series A funding round that it announced in April 2023, led by Munich Re Ventures, which followed a $5 million Seed round in 2021 led by Lightspeed Venture Partners, which also participated in the Series A.