Michael Lee joined Lone Pine in 2017 and was asked early on to cover artificial intelligence.
“you know, when I first joined Lone Pine in 2017, one of the first areas that was asked to cover was AI.”
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Michael Lee
1 episodes · 21 quoted claims
Lee conceived the Sequence idea in early 2023 but did not leave Lone Pine until later.
“Had a handful of people try to get me to lo- leave Lone Pine and go do it then, just wasn't the right time for me.”
Sequence Holdings and the Dell family office will co-control Baldwin.
“we are gonna be co-controlling this at Baldwin together, and we expect to be partners for a long time.”
Lee credited Michael Dell and Dan Batar, head of global direct investing at the Dell family office, with helping underwrite the Baldwin deal.
“I have to give Michael Dell, Dan Batar, who's the head of global direct investing, a tremendous amount of credit for working closely with us to underwrite the deal.”
Lee says insurance premiums flowing to carriers exceed $2 trillion per year, and brokers take a commission on them.
“It's 2 trillion dollar plus of premiums per year going to carriers. The brokers take a, uh, a vig on that”
Lee says insurance carriers earn most of their profit from investing premiums rather than from underwriting.
“The insurance industry since the beginning of time has almost made no money underwriting and has made the pr- principal amount of their money through investing.”
Lee says insurance brokers are paid by carriers rather than customers, and gross retention rates are around 90%.
“your customer doesn't actually pay you, the carrier does. So if you think about the nature of the business, which is a very relationship-centric business, gross retention rates are 90.”
Jamie Reynolds of Avenir connected Sequence with his family's Georgia bank, which became Sequence's first customer.
“And very fortunately, he his family happens to own a bank down in Georgia. Um, and that's how it became our first customer.”
Sequence began working with BankSouth as a services customer on August 4.
“And that started off August of last year. In fact, it was August 4th.”
Sequence's BankSouth investment was a minority stake, with a venture-sized check.
“It was an ability to buy a minority stake, so a venture scale s type check to operate in a real enterprise-like environment.”
Atlas is Sequence Holdings' shared technology platform, built first at BankSouth.
“One is Atlas, which is our platform, which I'll tell you about here more in a second.”
Atlas's second layer is an agent builder for creating AI agents grounded in ground-truth data.
“The layer on top of that is our agent builder, which is basically how do we build high performance agents grounded in ground truth”
Lattice is the orchestration engine in Sequence's Atlas platform, used to run workflows with AI agents.
“The third component to it is what we call lattice, what it, which is our orchestration engine, which is like, how do we actually instrument workflows using the agents that we've built?”
Lee says BankSouth's average consumer underwriting time decreased by 94% after Sequence began work in March.
“What we've done now today is we've built a system that can take take on all consumer loans within the organization. So the average cons- consumer underwriting today has decreased by 94 since we got started in March.”
Lee says the average BankSouth loan went from taking 30 days end to end to 11 days.
“we functionally have taken the average loan at the bank, which used to take 30 days to go go end to end, to eleven days.”
Lee says BankSouth's loan volumes doubled in the second quarter relative to the first, which he attributes to luck rather than Sequence.
“in Q2 of this year, relative to Q1, loan volumes doubled at the bank.”
Lee says Sequence aims to complete about one deal per year and has no required pace of deploying capital.
“We're trying to do one deal per year, that's it. We don't have a deployment cadence.”
Michael Lee previously worked at the private equity firm Apollo.
“I used to work at Apollo. I have a lot of friends who still work at all these various firms.”
Lee worked at Goldman Sachs after college before moving to Apollo.
“So I worked at Goldman coming out of college. I went to go work at Apollo, which was just like an awesome experience.”
Lee spent about five years at Lone Pine studying public companies before leaving to found Sequence.
“And that was a really, really powerful kind of five years that I did at Lone Pine, around studying the greatest companies in the world.”
Lee says he met Nvidia's Jensen Huang in 2017 while at Lone Pine.
“I remember meeting Jensen Huang in 2017. It's kind of crazy to think at the time, like today, that, like, it wasn't what it is today.”