The world of car ownership is changing. The proliferation of new mobility models, from Uber to scooter rental, combined with the approaching wave of connected and autonomous vehicles, means that the way people travel is changing dramatically. The proportion of travel that people do in their own cars is falling, and in the long run, may stop entirely for many.

The challenge from an investment perspective is being able to gain exposure to this tailwind within a typical investment lifecycle.

This is where we were fortunate enough to be introduced to James, Callum and the team at By Miles. They are tackling this opportunity, initially through rethinking car insurance, allowing drivers to pay for the miles they actually drive on a pay-by-mile basis

Car insurance in the UK is mandatory, unloved by customers and sold by incumbents as a product that’s largely the same as the one our parents bought. The traditional, unchanged model of fixed annual policies creates an opportunity for ambitious new entrants to be more personalised and target particular segments in a more sophisticated way.

The premise is a simple one: you’re less likely to have an accident if you aren’t driving. By Miles is designed to offer low mileage drivers a better price than they could receive from incumbent insurers, who typically use low mileage drivers to subsidise the higher cost of insuring riskier, high mileage drivers.

A customer simply plugs the matchbox-sized Miles Tracker into their car, turning their ordinary car into a fully connected one. By Miles uses this technology to collect journey information and provide value added services. In the future, the need for a Miles Tracker will go away entirely as By Miles utilises the new connected car services coming online from major car manufacturers.

The vision of the company is to use their pay-per-mile solution as a foundation on which to build a business in today’s world of broad car ownership. From this market position the intention is to develop a proposition suited to tomorrow’s world of autonomous and connected vehicles. We share their view that traditional insurance policies will find it difficult to tackle the transition of insurance risk from driver to driverless – that is, from the driver to the manufacturer.

By Miles went live in May 2018, and their TrustPilot scores speak for themselves.

The 13-strong team is led by James Blackham (CEO) and Callum Rimmer (CTO), who bring together a combination of insurance and technical expertise, two critical components in building a business in this segment.

We are delighted to have the opportunity to lead the £5m Series A investment into By Miles, alongside a group of existing investors that we respect, most notably InMotion Ventures (the corporate venture arm of Jaguar Land Rover), Hambro Perks Insurtech Gateway and JamJar. Good luck to James, Callum and the team in what we’re sure is going to be an exciting 2019.

If you drive less than 7,000 miles per year, check them out (www.bymiles.co.uk). You might be surprised in how much could you save.