A game-changing alternative in the death care industry
Author: Matt Waraich, Cortado Ventures Investment Associate
Cortado Ventures has always taken pride in pioneering innovative thinking and investment strategies. Our aim is not to just stand out from the crowd, but to collaborate with like-minded, forward-thinking partners who are committed to creating a lasting impact. That is just what is happening in Oklahoma’s first-ever venture studio. Founded in 2021 and based in Tulsa, Oklahoma, 19days was developed on a foundation of thorough research, rapid development, and inspiration from Albert Einstein’s famous quote, “If I had 20 days to solve a problem, I would take 19 days to define it and one day to solve it.” The company was established under the leadership of Managing Partner Joey Wignarajah, alongside Co-founders and Partners Dan Fisher and Jacob Johnson.
For those of you unfamiliar with venture studios and the 19days process, Joey describes this approach to innovation and creativity as the result of well-defined, repeatable processes, experimentation, and agility. Starting with finding critical problems to solve, the team proceeds to define them as specifically as possible. From there, using industry publications/articles, conducting customer discovery interviews, and ultimately sitting with customers to get to the depths of the problems they’re facing, this produces an innovative solution. Using these methods, the 19days team creates problem statements to produce an array of methods to validate them, including mock sales decks, pitching to customers, drawing storyboards, and iterating on 5-day prototyping sprints. This is where customer validation and speed create innovation.
Enter Prelude
Prelude is a 19days spinout led by former GitWit growth strategist, CEO Kris Yee, and the 19days team. Prelude has developed a software tool that allows funeral homes to increase their revenue by helping clients pre-plan (called “preneed” in the funeral industry) and pre-pay for funerals through industry-standard pre-need insurance policies. Revenue is tightening in the funeral home industry as more people opt for cremations, a less expensive option than traditional burial. Funeral insurance policies are standard, and the funeral home itself doesn’t generate revenue from those policies until the funeral occurs and is paid for, which typically happens on an average of 12 years later. This leaves the funeral home susceptible to losing money on preneed sales due to high inflation rates and lower face values due to the rise in cremation preferences.
But why would funeral homes use it?
Because the death industry is changing. The National Funeral Directors Association (NFDA) predicts that 80% of Americans will choose cremation by 2035.[1] Funeral directors are now looking to pre-need funerals to stabilize their business to avoid downward pressure on themselves and clients in need of funeral arrangements. The way pre-need insurance is sold now places all the risk on the funeral homes where the carrier and the agent get paid today, but the funeral home may get paid years later when costs of services have appreciated and don’t account for inflation. Lastly, and maybe most importantly, Prelude eases the sales pressure in an already delicate situation, allowing funeral directors to focus on caring for families while ensuring they achieve higher face values on their preneed sales with empathy at the center of the experience.
Will this affect me?
It will. Individuals aged 44 and under are less likely to suffer from health issues that result in death, but many younger adults are making the choice to pre-plan their funerals and purchase pre-need policies to alleviate the burden on their family members of ever having to deal with funeral planning and expenses. The 45 to 64-year age group is even more likely to opt in for pre planned services. Individuals aged 65 and up have increased as a proportion of the total population in recent years. This has shown a rise in the funeral business. The 65+ demographic represents the largest customer group due to the average life expectancy in the US being 78.8 years old in 2020, causing a greater demand for pre-planning services.[2] This demographic is positioned to
benefit most from funeral services on a pre-need basis. No matter which age group you may fall under, Prelude removes the funeral planning burden faster and more efficiently for everyone involved, especially for the funeral homes that so diligently serve their communities.
So how does it work?
Prelude improves the preplanning experience for both the customer and the funeral home through an informative and affordable software tool. Using the Prelude software, both funeral directors and clients are guided through this process with prompts and questions to uncover their planning needs with on-screen tips to help them along the way. Next, Prelude’s custom AI feature collaborates with the unique responses from clients’ prompted questions to create a personalized ‘Love Letter’ for their family and friends, explaining the reasons behind their decision to plan in advance. As soon as this is completed, Prelude automatically generates payment options, service agreements, and insurance applications for the user. For funeral homes, the benefits include a simple, user-friendly pre-planning tool that eliminates paperwork, reduces the risk of appearing too pushy in sales, simplifies the closing process, increases average face values, and has been shown to secure a sale in a single appointment, compared to the typical three. In addition, when working with Prelude, funeral homes can expect higher commission rates, competitive growth rates, and the flexibility to set their own commission schedule. The process is as simple as funeral homes signing up, users going through the Prelude process, and Prelude’s system instantaneously collecting payment information from the client, passing applications to the insurance carrier and putting the commission directly into the funeral home’s hands. Prelude is poised to be just the innovative tool that the struggling funeral home industry needs.
Why did Cortado Invest?
1. Confidence in 19days
The 19days thesis resonated with Cortado from day one. The team’s desire to create six to ten ventures between 2021 and 2026 was a testament to their continued support for the entrepreneurial ecosystem in Tulsa. With Jacob Johnson and Dan Fisher’s success in founding Gitwit, and Joey Wignarajah’s wealth of experience in both investor and operator roles, it was a clear indication that this team possessed the talent to execute on their vision of building, scaling, and selling, at warp speed to further the advancement of entrepreneurship in Oklahoma.
2. Innovation in “death tech”
With all the advancements in technology over the last 20 years, tech innovators have largely ignored the funeral industry. How is it that we can fit computers in our pocket but planning a funeral is still a daunting process, especially for bereaved family members. With a succinct process and user-friendly options, Prelude can put clients’ minds at ease. Prelude removes the hassle of tedious buying processes for clients and allows funeral homes to avoid the unnerving process of trying to sell insurance to already grieving family members while also creating profits now. It’s a win-win scenario.
3. Early success
What’s next?
Prelude V1 has garnered an enormous amount of support, having signed several customers before even spinning out of the venture studio and received a feature in the Funeral Director Daily, a major industry publication. Now they look toward rapid
growth. Prelude’s winning components of a capable team, positive customer feedback, and an underserved market is positioned to be a huge success for the 19days team.
About Cortado Ventures
Cortado Ventures is an early-stage venture capital firm that invests in ambitious, growth-driven companies to define a new generation of economic prosperity for the Midcontinent region. As one of the largest VC funds in Oklahoma, Cortado’s focus is on tech companies bringing innovative solutions to the energy, logistics, life sciences, aerospace, and the future of work sectors. For more information, visit cortado.ventures.
Read this article on Cortado Ventures Insights Medium Blog
https://medium.com/@mwaraich_30785/why-we-invested-prelude-f02a70a1b252