LA wildfires thrust insurance startup into spotlight as property owners scramble for protection
An aerial view of repair vehicles at sunset passing near beachfront homes that burned in the Palisades Fire as wildfires cause damage and loss through the LA region on January 15, 2025 in Malibu, California.
Mario Tama | Getty Images
Midway through December, tech entrepreneur Dan Preston debuted insurance startup Stand’s first product focused on protecting property in wildfire zones. He should have had months to work with prospective customers and to market the offering before any catastrophic fires hit the U.S.
In California, Stand’s home state, fire season normally lasts from early summer through October or November. Stand, which Preston co-founded early last year, announced a $30 million financing round and the new product on Dec. 16, a few days before the official start of winter.
But it’s been a winter like no other. Three weeks after Stand’s launch, wildfires ravaged parts of Los Angeles, killing more than two-dozen people, scorching about 41,000 acres due to extreme winds and destroying at least 12,300 structures.
“This is certainly not a time you would normally see events like this,” Preston said in an interview this week. “It has put an accelerant on business in a pretty massive way. As soon as this stuff started happening, the inbound demand was about 5-10x overnight.”
Preston has been trying to innovate within the typically boring and slow-moving insurance industry for well over a decade. In 2013, he became technology chief at auto insurance upstart Metromile, and later took on the role of CEO, guiding the company into the public market in 2020 through a special purpose acquisition company (SPAC). Metromile hit a rough patch after its SPAC and sold to tech-powered insurer Lemonade in 2022. Preston stayed on at Lemonade for another year.
At Stand, Preston is aiming to go big in a market that legacy insurers are rapidly abandoning because it’s viewed as too risky. As of mid-2024, at least eight insurance carriers had left the state or limited their exposure. The California FAIR Plan, generally viewed as an insurer of last resort, had seen a 137% increase since 2019, and that was well before the latest LA fires began. According to LendingTree, about 10% of homes in Los Angeles are uninsured.
It’s not a surprise that firms are exiting the state. Goldman Sachs estimates that insurers could face up to $30 billion in losses tied to the LA. fires.
Through a combination of technology and a reimagining of home insurance, Preston wants to offer reasonably priced protection to homeowners in wildfire zones.
Stand CEO Dan Preston, who was previously CEO at Metromile
Winni Wintermeyer
For property owners, the key piece is recognizing that they have to make changes to their homes and the surrounding land so that fires are less likely to spread out of control. That could include pruning trees, replacing wood fencing with steel or adding concrete barriers between homes. Stand uses artificial intelligence and what it calls “physics-driven insights tailored to each property” to make specific mitigation recommendations that can make a property insurable.
Preston said the company, which currently has 13 employees, has only insured a few properties so far, but is in talks with hundreds of potential customers. That number is increasing dramatically, he said, as property owners start to understand the consequences of the LA fires.
“It will be a lot harder for folks to find insurance the next couple years because of this event,” Preston said. “In some ways, we have have a responsibility to level up our ambitions, bringing insurance back to the market.”
Navigating the bottlenecks
Bill Clerico, one of Stand’s co-founders and initial investors, was expecting a busy January, but for very different reasons. He and his wife just had their second child. And on Jan. 7, Clerico’s fire-tech focused venture firm, Convective Capital, filed to raise $75 million for its second fund.
Clerico said he can’t talk about Convective’s fundraising at the moment, but he is using the disaster to try to raise awareness about strategies for wildfire mitigation and some of the tools and technologies that are available. In a post on X on Jan. 8, Clerico wrote that four keys to dealing with wildfires are forest and fuel management, rapid detection using cameras and satellites, “hardening” of homes and communities, and reducing fires caused by utilities.
“The bottlenecks are mostly around adoption and deployment — a lot of these technologies are not cutting-edge stuff,” Clerico said in an interview. “Drones have existed for decades, satellites for decades. It’s cameras and software, which found its way into every aspect of society expect public safety.”
Before launching Convective three years ago, Clerico was co-founder and CEO of fintech startup WePay, which he sold to JPMorgan Chase in 2017. He then spent over three year’s as a managing director for the bank in the Bay Area,
Stand simulation
Stand
Clerico lives in San Francisco and has a cabin in Anderson Valley, about 115 miles north of the city. He said that a wildfire there in 2018 inspired him to volunteer at the local fire department and was a factor in leading him to start investing in the space.
While VCs have poured into clean tech in recent years, they’ve mostly avoided investing in companies focused on resiliency and adaptation, in large part because the buyers are “pretty large slow-moving institutions, like utilities, government and insurance,” he said.
Clerico said that what’s unique about Stand relative to other tech startups that have tried to crack insurance is that competition in its target market is dwindling rather than increasing.
“Existing insurers don’t compete, they’re exiting,” Clerico said. “if you can have better informed view on risk, it’s a much more favorable place for a startups.”
Still, it’s an extremely tough market.
Stand is currently focused on homes that are worth $2 million to $10 million, which Preston said covers properties facing a lot of “distress.” The company is working with a number of reinsurers and expects to be able to bring costs down as it proves the model can work.
But making a meaningful contribution to the bigger problem will require significant behavioral and structural changes in neighborhoods that, like Pacific Palisades in LA, are suddenly at risk of almost disappearing overnight. The mission has to go well beyond protecting individual homes one at a time.
“We might be able to play a much larger role in the state of safety if we can work with neighborhoods, and require homeowners and city officials to design neighborhoods to be more resilient,” Preston said.
WATCH: Rebuilding LA is most pressing issue when fires recede
Dado Ruvic | Reuters
Apple and Google removed TikTok from their app stores Saturday night, complying with a law requiring China’s ByteDance to divest the social app or see it face an effective ban in the U.S.
The Apple App Store and the Google Play store’s removal of TikTok means people in the U.S. can no longer download the popular short-form video app on their devices. The app’s delisting comes after the Supreme Court on Friday unanimously upheld the Protecting Americans from Foreign Adversary Controlled Applications Act, which President Joe Biden signed in April. TikTok on Friday said its service would go dark, meaning it would stop working for Americans, unless the Biden administration intervened.
On Apple’s App Store, a message saying “App Not Available” appears on TikTok’s former app-install page.
“This app is currently not available in your country or region,” the message said.
“We’re sorry, the requested URL was not found on this server,” said a message on the page the previously hosted TikTok on the Google Play store.
Some users who visited TikTok’s app and website on Saturday were greeted with a message that said, “Sorry, TikTok isn’t available right now.”
“A law banning TikTok has been enacted in the U.S. Unfortunately, that means you can’t use TikTok for now,” the notice said. “We are fortunate that President Trump has indicated that he will work with us on a solution to reinstate TikTok once he takes office. Please stay tuned!”
Lemon8, another service owned by ByteDance, also displayed a notice letting users know it wasn’t available in the U.S. The app had shot up the charts recently, becoming one of the most popular free apps on iOS.
“Sorry, Lemon8 isn’t available right now,” the notice states.
TikTok halted service of its app in the U.S. on Saturday.
The law requires that service providers no longer support TikTok within the U.S. if ByteDance failed to carry out a “qualified divestiture” of the app by Sunday. As a result, Apple, Google and Oracle could face tough penalties for failing to adhere to the law. Apple and Google previously distributed the app through its app stores while Oracle provides cloud computing services to TikTok and said in June that the law would hurt its business.
After the Supreme Court’s decision, TikTok CEO Shou Chew said use of TikTok is a First Amendment right and added that over 7 million American businesses use it to make money and find customers.
Awaiting Trump
“Rest assured, we will do everything in our power to ensure our platform thrives as your online home for limitless creativity and discovery as well as a source of inspiration and joy for years to come,” Chew said in a TikTok video.
Chew also thanked President-elect Donald Trump, who previously asked the Supreme Court to pause the law’s implementation and allow his administration “the opportunity to pursue a political resolution of the questions at issue in the case.” Chew is expected to attend Trump’s inauguration in Washington on Monday, along with tech leaders from companies including Meta, Amazon, Apple and Google.
Trump arrived in Washington Saturday evening. His transition team did not immediately respond to the TikTok shutdown. Trump on Friday said that the Supreme Court’s decision was expected “and everyone must respect it.”
“My decision on TikTok will be made in the not too distant future, but I must have time to review the situation. Stay tuned!” Trump wrote in a post on his social media app Truth Social.
White House press secretary Karine Jean-Pierre on Saturday acknowledged TikTok’s statement that it would go dark and characterized it as a “stunt.”
“We have laid out our position clearly and straightforwardly: actions to implement this law will fall to the next administration,” Jean-Pierre said. “So TikTok and other companies should take up any concerns with them.”
Trump told NBC News on Saturday that he would “most likely” give TikTok a 90-day extension of the Sunday deadline, and that he would “probably announce” a decision on Monday.
“I think that would be, certainly, an option that we look at,” Trump said in the phone interview. “The 90-day extension is something that will be most likely done, because it’s appropriate. You know, it’s appropriate. We have to look at it carefully. It’s a very big situation.”
Artificial intelligence startup Perplexity AI on Saturday submitted a bid for TikTok that would result in the AI-powered search engine startup combine with TikTok’s U.S. operations and new capital partners, CNBC reported.
Businessman Frank McCourt’s internet advocacy group Project Liberty announced on Jan. 9, that it had submitted a proposal to buy TikTok from ByteDance at undisclosed terms. McCourt told CNBC on Friday that “we, I believe, are the only bidder” that meets the necessary criteria of disentangling the technology from the Chinese algorithm.
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