How government can unlock billions of dollars in savings

A US start-up used government data to make $1.5 billion. The New Zealand government put data to work to find $954 million. The potential for Australian agencies is enormous. But internal barriers remain.

In the United States in 2006, two former Google employees formed a company, Weatherbill, to provide weather insurance to ski resorts, large event venues and farmers. In 2010, Weatherbill decided to focus exclusively on agriculture, launching the Total Weather Insurance Product.

The move prompted Greentech Media to ask: “Is it the Riskiest Startup Ever?” It explained:

“The company’s algorithms continually examine streams of incoming weather data, past history, local conditions and other factors to devise a personalised insurance policy for a farmer.”

What the article didn’t say was that Weatherbill, by then renamed The Climate Corporation, was basing its premiums on a huge trove of data supplied by the US government: 60 years of crop yield data, 14 terabytes of soil data and information from a government network of 159 weather radar stations. The result was that the company did very well: it was bought by global behemoth Monsanto for $1.49 billion in 2013.

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