Protecting businesses and livelihoods from previously unmanageable price volatility
We announced this week our participation in Stable’s Series A fundraise, alongside Greycroft, Anthemis and others so I wanted to share some insights into the thinking behind this latest addition to the Notion stable ( 🙂 – sorry, couldn’t resist).
Trade in agricultural commodities is one of the biggest (and most impactful) industries on the planet at over $10 trillion dollars per annum. Both sides of this trade have surprisingly limited options when it comes to hedging price risk, with just 10% of agricultural commodities traded on a financial exchange. Businesses and livelihoods are put at risk every month by unpredictable and unmanaged price volatility. Stable founder CEO Rich Counsell, a farmer’s son and ex-commodities man himself, saw the opportunity to address this massively underserved need. Afterall, since reliable indices exist (from the USDA and others), then it should be possible to price the risk, offer hedging instruments to clients on both the sell- and buy-side and assemble a diversified portfolio of risk capital providers to underwrite it.
That is exactly what Stable has done. With a team of super-smart data scientists / machine-learning experts and industry veterans from Cargill, CME, Rabo Bank and others, they have built the world’s largest parametric insurance platform with over 7,000 indices covered and backed by AAA-rated reinsurance partners. This means price risk can be hedged to previously unheard-of levels of granularity in even quite niche commodities and very localized markets. They count some of the world’s largest food production companies as clients including many household names, hedging price risk in malting barley, tallow, sesame, pork and avocados (much to Itxaso’s delight) amongst others.
At Notion, we love exceptional founders with smart and ambitious teams solving globally important issues in massive markets, with uncapped upside. Stable ticks all the boxes so I am thrilled to be joining Rich and the wider Stable team on their extraordinary journey.
Why Notion? A note from the founder…
Being the sole founder of Stable, I had to rapidly build out the support I needed from a proven team that could execute our plans for Stable. When it came to investors, I wanted to prioritise people that had been in the entrepreneurial trenches themselves to join us on this mission and truly understand what that means both personally and professionally.
After being introduced to Stephen and the team, and hearing first hand about their experiences in starting, scaling and exiting businesses, it was clear that Notion was the right home for Stable to thrive. Their support and encouragement has given us the confidence to think bigger and better and how we’re making this happen.