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CapitalG backs Applied Systems. Devoted raises $300M. This week in insurance tech.
Hi there,

One question we get asked frequently is what the cohesive strategy of some of the tech giants is in insurance (or if there is one). 

Investors at both SoftBank and Alphabet's capitalG, for example, expressed interest this week in making more investments in the industry (see here and here):

“We have talked to big insurance groups to figure out where we can play, what might be interesting. There are several similar combinations and permutations about a bet we could place.” — David Thevenon, SoftBank Vision Fund

“We will definitely be looking for additional investments in the insurance technology space.” — Jesse Wedler, capitalG

While it can be easy to speculate, we find it instructive to just look at where bets are being placed already – such as in this brief that analyzes everything Amazon is doing in financial services.

This week, Alphabet's capitalG made an investment in Applied Systems, the Hellman & Friedman-owned software provider for independent agencies. The deal gives Applied access to Google's engineering and product teams in areas including artificial intelligence, machine learning, and digital marketing.

Applied also announced it acquired Dynamis, a software startup that benefits brokers could use to compare the different health plans available to employers.

Per capitalG's Wedler: “I am not a spokesperson for Google’s insurance strategy overall, but that is 100 percent the case—we are believers in the agency channel.”

What's interesting is that if you compare across all of Google's investment arms, you see some contrasting portfolio cos with Applied including full-stack carrier startups and tech-enabled benefits brokerage. Graphic below.



Rise of real estate tech

We put together some slides on real estate tech earlier this week, including the rise of iBuying, new home equity-related startups, rent-to-own models, and innovations around flexible leasing and property management.

While real estate tech investment has grown in recent years, it has paled in comparison to overall fintech (across lending, wealth management, insurance, and more). 



Of course, the two aren't all that dissimilar (and include many companies that cut across both). As Bain Capital's Matt Harris noted at Bloomberg's Sooner Than You Think conference, "The interesting problems in real estate are fintech problems."

Download the slides here.

Have a great week,

Matt
@mlcwong

P.S. We just rolled out our new client-only mobile app. The CBI mobile app lets you see all of our research on your phone and quickly get all the relevant data about a company you're trying to understand. Get it here.

Unpacking the insurance tech landscape

A deep dive into the state of insurance tech, including home, auto, small business, life insurance, and more from ITC 2018. Get a copy.
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Rise of real estate tech

A high-level look at recent investment and startup trends in real estate tech and the growing iBuyer space. Get the slides.
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This Week in Insurance Tech 

A curated mix of recent articles on insurance tech financings, exits, hiring, product launches, partnerships, and perspectives.

Deals

Devoted Health raises $300M. The Medicare Advantage business is founded by serial entrepreneurs Todd and Ed Park of Athenahealth and Castlight Health. The fundraise values Devoted at $1.8B. Andreessen Horowitz led the round.
CNBC

Prima Assicurazioni raises $116M. The Milan-based online insurance agency of Munich Re's Great Lakes raised the funds from Goldman Sachs and Blackstone. The company has approximately 250k clients and generates €65m in revenue.
FinSMEs

capitalG invests in Applied Systems. Applied Systems gains access to Google expertise in areas including artificial intelligence, machine learning and digital marketing. Applied has generated $388M in revenue through Q3'18.

Insurance Journal

Proformex raises $3M. The Ohio-based company provides a life insurance policy management system.
CB Insights

Jooycar raises $3M. The Latin American connected car startup develops usage-based insurance products for commercial and personal lines.
Tech Startups

Foxquilt raises $920K. The Canadian startup aims to "empower social groups to save on home, small business and auto insurance."
Canadian Underwriter

Wukongbao raises Series B. The investment to the Beijing-based "scene customization" digital insurance broker was led by 58.com and Guohua Life Insurance.
Ebrun

Yellowwoods invests in Simply Financial. South Africa-based Simply Financial Services offers life, disability, and funeral combos for families, domestic workers, and business employees. 
Disrupt Africa


By (re)insurers

Greenlight Re invests in Click2Sure. The South Africa-based digital broker Click2Sure enables cross-selling of product insurance at the point of sale.
Reinsurance News


M&A

Applied Systems acquires Dynamis. The acquisition expands Applied System’s employee benefits offerings.
Insurance Journal

Company & Insurer News

Mapfre launches storefront on Amazon. The Spanish insurer will offer its products on Amazon.es via a branded storefront. The companies are exploring the possibility of adding Amazon lockers to Mapfre offices and incorporation of Amazon Pay.
El Espanol
 
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