ManyPets pauses marketing in the US

Pet insurance startup ManyPets has paused marketing in the US as it looks to get some business aspects under control.

In a company presentation we reviewed, ManyPets states that in the US, customer acquisition costs have been “too high,” average order value has been “lower than planned,” and retention is a “lot worse than it should be.” These aspects, along with having to devote a lot more resources than expected to US operations, have led to a LTV:CAC that is “much lower than it needs to be.”

In a conversation with ManyPets co-founder and CEO Steven Mendel, we were told that the startup plans to turn back marketing in the US in a few months. Still, this is a significant event since the US market is seen as the startup’s “golden goose” and biggest opportunity.

ManyPets, which closed a $350 million Series D round almost two years ago, is facing additional challenges. In the UK, its biggest market, the startup is experiencing lower sales compared to the COVID pet boom days. This reality is impacting the mix of business – new business policies have gone from comprising 46% of the book in June 2021 to 25% of the book in June 2022.

ManyPets has also been falling short when it comes to its loss ratio target in the UK, and it is dealing with longer than expected claims handling times.

We were also told that ManyPets has been exploring alternatives for its operations in Sweden.

Overall, the startup has been falling short in regards to several goals, leading some to suggest “small adjustments” to company goals to reflect the changes in the economic and fundraising environment.

These challenges have led to a workforce reduction – ManyPets has made layoffs earlier this year.