The Start of Notch
Rafael Broshi worked at a hedge fund but left around June 2020. He took this opportunity to look at other markets, including insurance, which led him to study a recent event where an insurance company was hacked and asked for ransom. However, the insurance company did not end up paying the ransom because they have cyber insurance, which protected them.
This led Rafael and two of his good friends and eventual Notch Co-founders, Yuval Peled and Elool Jacoby, to consider what would happen to them or other small businesses if they were hacked online. During their research, they found that small businesses and creators should be more concerned about insuring their digital assets, rather than a computer infrastructure like big companies do.
“Every new business that is being started today relies on some sort of digital asset as either the growth engine or lead generator of the company, so that’s a social media account and it doesn’t matter if you’re an online content creator or if you have a clothing store.”
He adds, “If something happens to your Facebook ad account or to your social media account, that’s going to dramatically impact the number of new leads you get to your business right away.”
Instagram is the largest platform small businesses use to get exposure to new customers, so Notch was developed to protect social media accounts against account hacks and takeovers.
Who is the Target Audience for Notch?
Notch currently covers larger audiences, starting with accounts with a few thousand followers.
Rafael shares that Notch plans to expand their offerings over the next few months to smaller accounts, too, as long as they demonstrate a real business behind the account. For example, a hairdresser with a thousand followers who uses Instagram to interest new customers.
“The fact that you don’t monetize directly through Instagram doesn’t matter, you still get your leads through there, and that’s the important part, so right now, the target audience is creators, but pretty soon, the target audience is also going to be small businesses in the United States.”
Currently, Notch is offered in 11 states, but they are working on going nationwide by the end of the year and eventually internationally.
How Can I Become Insured with Notch?
Rafael shares that it’s straightforward to become insured with Notch and only takes seven clicks and a total of 60 to 90 seconds to set up.
Notch offers annual and monthly options to give creators plenty of choices when it comes to insure their Instagram accounts.
“From that moment on, we ask you a few more simple questions: What’s your name? What’s your physical address? A lot of people ask us why do we need it. It’s a regulated insurance product, [so] we have to know where you live or [that] you own a business.”
The insurance policy quotes are based on Notch’s valuation of how much money and potential earnings your account can make. Rafael shares that the coverage is up to three months of lost income.
“More than 50% of [hacked] accounts don’t get back to their owners within the first 90 days, which is a long time. Only 25% of hacked accounts are being returned to their owners within the first two weeks, but the first two weeks is the highest likelihood of getting your account back.”
Are Hacks a Real Threat?
Rafael shares that hacks are an incredibly real and frequent threat.
“Every 10 minutes a creator in the US gets hacked, so that’s a lot of people.”
The typical hack prevention advice is to have a strong password and use two-factor authentication so you won’t get hacked. However, Rafael explains that this can only help so much.
“No one hacks Instagram like we see in the movies and then takes control of your account. Instagram is a highly secure platform, and whenever someone takes over your account, it’s due to a social engineering attack. A social engineering attack means you were tricked into giving your credentials.”
He shares that the most common example of this is creators getting an email from a domain impersonating Instagram that states they have violated the terms of service and are at risk of being suspended.
“Now, you might say, but who falls for them [scams]? But you need to understand that this email is not being sent only to you. It is being sent to thousands of creators each day.”
The huge number of people that are sent this email ensures that at least a few people will click on the link and fill out the form revealing their Instagram credentials.
Another common scam is an email that appears to be from a friend or coworker requesting urgent action and asking for a money transfer. Rafael explains that you should always call the person to confirm this is true before doing anything the email asks.
Notch cannot guarantee that they will be able to recover a hacked account. However, they guarantee that you get the details of your insurance policy covering up to three months of lost income. The daily reimbursement begins 48 hours after being hacked.
Notch also provides monitoring benefits, which will immediately alert you if your account is hacked. Time is of the essence when it comes to getting hacked, so this is a valuable feature for creators trying to get their accounts back after a hack.
Future Plans for Notch
“I would say that the first thing we’re probably going to add onto the product will deal with suspensions, which are the second most common problem in Instagram. It’s actually much more common than being hacked, but in most likelihood and much faster, those cases get resolved and people get their account back at the end of the day.”
In the future, Notch is also looking to expand their coverage into other social media platforms, such as TikTok or YouTube. Rafael notes that YouTube will likely be the next platform the Notch team expands their services to.
Rafael shares that the Notch team is excited to continue building a new type of insurance that has never been done before.
“The insurance is very, very tailored to small businesses, so we started with creators. Creators are only a small sub-segment of small businesses in general, right? And cyber insurance is a product that doesn’t necessarily fit those very small businesses… Second, it’s [cyber insurance] is usually expensive. Third, it will not always cover what you really want.”
He also advises creators to ask their traditional insurance companies offering cyber insurance if these policies will help them when their social media accounts get hacked, which is uncommon with traditional coverage.
On the other hand, Notch is designed especially for social media accounts and includes a host of services, from insurance payouts if you are hacked to monitoring your account 24/7 for hacks, prevention, and crisis management. They also begin payouts only 48 hours after an account hack, unlike traditional insurance, which can take months to start paying.