“It is not possible to grow just based on consultancy, you have to pass from ideation to product” This was the initial proposition of Cenk Tabakoğlu when he joined Lumnion as CEO in 2020. When the Istanbul Technical University GİNOVA* team interviewed him in the context of the SME Cluster Growth project, we realised that this was just one of the pillars of his global growth vision.
Lumnion was built in 2017 by two engineers as a technology and consultancy company offering solutions to insurance companies based on data analytics. According to Tabakoğlu, the company was not growing when he started to work for Lumnion. The first challenge was to slow down the work on the consultancy side and accelerate product development. Thanks to the introduction of new AI-based pricing platforms, the company’s growth phase has begun. Although “technology is our soul” is the motto of Lumnion, it was not the sole factor underlying the growth. Mr. Tabakoğlu asserts the importance of market knowledge by stating that his previous experience in the banking and insurance sectors inspired him a lot in delivering appropriate solutions at Lumnion:
“I was at the other side of the table through all those years, and I saw the needs of the market as well as sectoral deficiencies. I was in search of innovative solutions with new technologies especially about insurance pricing.”
This is how they were successful in applying algorithms focusing on better estimation of risk and more suitable pricing along with customisation. Analyzing the market needs was the guiding force behind the company’s organic growth. Mr. Tabakoğlu does not believe that income is the driving factor in growing, but the ambition to succeed by outperforming the market leader. It was clear that this could be achieved by meeting the specific needs of customers in the insurance market through creating differentiated technological innovations.
Another important pillar of growth is building strategic collaborations, according to Mr. Tabakoğlu. He claims that “in order to ensure rapid growth, you have to multiply distribution channels and since it would not be easy for the company to do this in an organic way on its own, strategic collaborations are required”. Such collaborations include companies, universities, even employees. The support of Istanbul Technical University Incubation Center (ITU Cekirdek) was exemplary in terms of promoting them, creating a reliable network, and receiving investment. Sabancı University has been their partner since the beginning of the journey; they cooperate especially on the machine learning side. Their close relationships with several insurance companies in joint product development and tracking operations as well as their collaboration with SAS in Turkey show their willingness and ability to cooperate.
Lumnion’s next phase in growth is to be a global player. Their achievements present good evidence of their future target. They were the first company from Turkey to be accepted to DIA in Amsterdam, Europe’s largest digital insurance organization. Currently, they are the only company from Turkey that has been accepted to a program supported by the German government in Munich, where they were accepted among 20 companies from over 250. Mr. Tabakoğlu has decided that it is the right moment to move the office to Munich, Germany while they feel ready to develop markets next to product development in their growth target.
“In only two years, Lumnion has grown to challenge its multinational competitors in insurance pricing.”