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Global fintech Q3'18 report. Fintech 250. This week in insurance tech.
Hi there,

As we look ahead, one of the digital ecosystems that looks to become more relevant for insurers over time is payroll/HR software.

Not only are macro trends like rising interest rates and a tight labor market driving more SMBs toward software vendors — the value of payroll data aggregated on these platforms is growing.



Consider new product rollouts that are a direct result of aggregating and unlocking payroll data, such as Gusto's Flexible Pay feature that launched earlier this year:

"The key to this new feature has been Gusto’s increasing data about small businesses. Gusto...has comprehensive access to its customers’ financial and payroll data. With integrations to time sheet services and proper risk modeling, Gusto is able to predict exactly what salary a worker has already earned, and can front the money at minimum risk to itself."

The growing number of businesses moving toward cloud SaaS solutions for HR and payroll automation has implications for both P&C and benefits providers. Consider that service bureau Paychex (which is being challenged by software vendors) just started breaking out "PEO and insurance services" revenues separately in its financial results, and today ranks as the 20th largest US insurance agency per Insurance Business. 



On the benefits side, a number of newer cloud payroll/HR software platforms also now operate insurance agencies or PEOs. More recently, we've started to see more one-off partnerships between cloud payroll/HR software platforms and carriers. Last week, Canadian HR, benefits, and payroll platform Rise People announced a partnership with and equity investment from Sun Life Financial, which includes a complete integration with Sun Life to launch in Q1 2019.

On the P&C side, we've seen platforms in the US like Gusto, Square, and Intuit partner with agency AP Intego to integrate pay-as-you-go workers' comp. In doing so, software platforms are looking to sell more products to create additional levers for retention. Purpose-built API integrations allow each platform to present such offerings in different ways. 



Today's SMBs now have a plethora of reliable, integrated HR/payroll software options. But as software becomes more important for payroll, it'll be interesting to see how relationships between such platforms, agencies, and insurers (or their startup challengers) evolve as tech integrations improve and political leaps are taken. 

Global fintech Q3'18 report

We put out some new figures on global investment to VC-backed fintech companies today. While early-stage fintech deals are declining, fintech mega-rounds continue to flourish.

Get a copy of the report here.



Telematics come up on earnings calls

We've seen more insurers bringing up telematics on earnings calls this year including new pilots and commercial opportunities. We'll dig into these and more on the telematics front in a longer analysis next week. Stay tuned.



Have a great week,

Matt
@mlcwong

The Fintech 250

CB Insights unveiled the second annual Fintech 250 — a list of 250 of top fintech startups applying a mix of software and technology to transform the financial services industry. See the 250.
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Global fintech investment report: Q3'18

A data-driven look at global financial technology investment trends, top deals, active investors, and corporate activity in Q3 2018. 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

Ethos raises $35M. The San Francisco-based digital term life MGA is valued at over $100M with the new investment from investors including Accel and GV.
CNBC

Azur raises $17M. The UK-based company provides underwriting products for the high net worth insurance market in the UK and builds end-to-end platforms for insurers. AIG is an investor.

Finextra

omni:us raises $16M Series A. The German company, which classifies and extracts data from digital documents, is reportedly working with over half of the top 10 insurers in the DACH region.
TechCrunch

Roojai raises $8M Series A. The Thai car insurance portal has reached over 30,000 customers to date. IFC led the investment.
Compelo

Kinetic raises $4.5M seed. The New York-based startup provides a wearable device aimed at reducing workplace injuries for industrial workers. Primary Venture Partners and Crosslink Capital are investors.
PE Hub


By (re)insurers

Sun Life invests in Rise People. The equity investment and strategic partnership will result in a complete integration between the HR and benefits automation platform and Sun Life in 2019.
Benefits Canada

AXA Ventures invests in K4Connect. North Carolina-based K4Connect provides tech-enabled solutions for 13,000 senior living residents.
Senior Housing News

New York Life Ventures invests in Carrot. The California-based startup provides a digital smoking cessation tool called Pivot.

HCA News

AXA Ventures invests in Hackajob. The UK-based startup provides a recruitment platform for matching technical candidates with companies.
UKTN



M&A

CoreLogic acquires Symbility Solutions. The acquisition expands CoreLogic's footprint in P&C insurance claims workflow solutions. CoreLogic previously owned 28% of Symbility.
HousingWire

Charles Taylor acquires CoVi Analytics. CoVi, a Startup Bootcamp alumnus, developed an analytics platform to simplify and automate risk and compliance management for insurers and brokers.
II Reporter

Company & Insurer News

AXA XL launches cyber insurance for SMBs. The partnership with Slice Labs will offer cyber policies covering data protection and private risks to SMBs with a $3M limit.
Business Insurance

Digit partners with Xiaomi. The Indian digital general insurer partnered to launch a screen protection plan with Xiaomi's Mi Home stores.
Economic Times

Berlin's Emil launches per-mile car insurance. The German startup, which uses an OBD-II IoT device, is aimed at drivers who do less than 6,200 miles per year. Partners include General Reinsurance AG and Gothaer Allgemeine Versicherung.
TechCrunch

Marsh partners with Concirrus. The partnership will see Marsh adopt the startup's marine analytics to help drive placement strategies for clients and identify new opportunities for digital product development.
Insurance Journal

Atlas Financial launches on-demand rideshare insurance. The mobile usage-based product for rideshare drivers is piloting in Illinois as optOn.
Atlas
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