Armadillo founder Matan Slagter

Armadillo, a technology-first home warranty company, launched in fall 2021 with initial investors and a core leadership team with strong ties to the Louisville area. Just last month, Armadillo announced a $3.5 million investment from a venture fund backed by insurance brokerage NFP Corp.

The company was co-founded by Louisville entrepreneur Lansdon Robbins and insurance industry veteran Matan Slagter. Armadillo is based in Clarksville, Indiana, but its growing team of 15 full-time employees and contractors work virtually from across the country. We spoke to Slagter about Armadillo’s plans for growth in what it sees as the largely untapped home warranty market.

What about your technology sets you apart from the competition?

Slagter: Most of the competitors in the home warranty space have been around for many years, and therefore have been built on legacy technology and infrastructure. Because our company was born in 2021, all of our technology is built natively in the cloud. We’re using some of the most flexible development languages, and everything we are building is modular, which provides us with strategic flexibility to iterate our value proposition rapidly.

We also have leveraged strategic partnerships to further fuel our technology capabilities. As an example, one of our original seed investors, Lyle Donan, owns a company called Source7. Through Source7, we are able to get risk data on over 90% of appliances at the serial number level. That means that we know which appliances have a higher propensity to cause different types of losses, like fire damage and water damage. We also get access through Source7 to product recall information. We are only in the early innings of how this data can be leveraged to improve value to the customer, value to our partners, and ultimately the profitability of our business.

We’ve read that only about 4 percent of homeowners have home warranty coverage?

Slagter: If you dive even deeper into that number, you see that the pandemic has caused many families to leave cities and purchase homes in the suburbs. This exodus over the past years has so many young families becoming first-time homeowners. So when you look at the market momentum underlying that 4%, there are underlying shifts that are very attractive to us.

Your site recruits for partners in both the real estate and home insurance markets. Are these channels essential for Armadillo’s growth?

Slagter: Most home warranties today are sold through the real estate transaction or real estate agent agents. We certainly do that with our talented and connected realtor sales team. But we also focus on a number of new innovative distribution channels that our competitors really have no presence in. We expect that some of these new distribution opportunities will expand us beyond that 4%, as opposed to capturing market share from competitors.

You have developed several relationships in Louisville, including with Hornbeam Insurance.

Slagter: Louisville is our home. All of our original investors, which essentially seeded the company, are Louisville natives. Our insurance carrier partner, Hornbeam, is based in Louisville as well. The leadership team at Hornbeam comes from a company called Service Net – a very large extended warranty administrator started by my co-founder Lansdon Robbins in the 1990s and ultimately acquired by AIG in 2012. I can say, from very deep experience in the warranty space, that the Hornbeam team is probably the most knowledgeable group of people in the warranty space, and they have been an absolutely wonderful partner to us.

Louisville is actually a great place to start a warranty business. There is so much talent in the Louisville/Indiana area. Our CFO lives in Louisville and all of our initial investors, our third-party administrator that helped us with claims is out of Louisville, our insurance carrier, and even our technology development software firm. We found so many of the ingredients that we needed to start a business and to build the foundation in Louisville!