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Venture Capital
FINANCE | Investment Firms & Funds
keatingcapital.com

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Investments

30

Portfolio Exits

17

About Keating Capital

Keating Capital (Nasdaq: KIPO) is a closed-end fund (regulated as a business development company, or BDC, under the Investment Company Act of 1940) that specializes in making pre-IPO investments in emerging growth companies that are committed to and capable of becoming public. The firm provides investors with the ability to participate in a publicly traded fund that allows stockholders to share in the potential value accretion that is believed to typically occur once a company transforms from private to public status, or what is referred to as the private to public valuation arbitrage.

Keating Capital Headquarter Location

5251 DTC Parkway Suite 1000

Englewood, Colorado, 80111,

United States

720-889-0139

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Latest Keating Capital News

Agencies Can Survive Insuretech, Say Experts at Southern California Conference

Mar 23, 2017

Comments “If we survive the next five to 10 years and improve the way we do things, we can be well-positioned into the future.” James Keating, founder, chairman and CEO of The Keating Group, offered those positive words amid the din voices calling attention to the dangers of disruption in the insurance industry. Keating spoke to a crowd of insurance professionals on Thursday at the WIAA Education and Research Foundation state of the industry conference in Irvine, Calif. Other featured speakers at the conference included George Muller, deputy commissioner of enforcement for the California Department of Insurance, Beth Ossino, claims manager for Golden Bear Insurance Col, Joel Laucher, chief deputy at the CDI, and John Finston, the CDI’s general counsel. Keating was one of a handful of speakers who focused on subjects like technology and industry disruption. The Keating Group is a holding company for Keating Cos., tKg Wholesale Brokerage, tKg Online, WholeSource and Keating Capital. The fortysomething has gone a long way in a short time building out these firms, as evidenced by the story of his firm’s growth he told at the conference. James Keating, founder, chairman and CEO of The Keating Group, spoke at the WIAA Education and Research Foundation state of the industry conference in Irvine, Calif. on March 23. In 2004 he drove from Phoenix, Ariz. to Boston, Mass. to make a start in the insurance business armed only with his knowledge and a $75,000 bank account. By the end of that year he was in four markets, had 516 submissions and $3.8 million in written premium. “I remember telling my grandma ‘If I could just get to $10 million in premium, I’d be happy,'” Keating said. As of 2016, the firm was in 172 markets, had 45,000 submissions and $181 million in written premium. He estimates the firm’s market value is between $45 and $55 million. He juxtaposed that value with the value that the independent agency holds for the business world and society in general. “The independent agency, in my opinion, is one of the most valuable parts of the American economy,” he said. However, independent agencies must embrace technology to compete with large concerns and disruptors, he said. One way he suggested to compete with all of the large companies and well-funded startups coming into the industry is to invest heavily in technology. Between 2004 and 2009 his firm grew by $8.7 million, and then between 2010 and 2016 it grew by $52.7 million, according to Keating. He measured the proportion of that growth by a ratio of his spend on technology in those same periods. Keating’s IT investment from 2004 to 2009 was $1.4 million. Starting in 2010 up to last year that investment rose to $6.1 million. “You’ve got to invest in technology,” he said. Richard Kerr, chairman and CEO of Dallas, Texas-based electronic insurance exchange MarketScout Corp., hammered home a term that became a common thread throughout the speaker presentations: Insuretech. Like Keating, Kerr encouraged agency owners and managers in the audience to take note of the growth of insuretech and to look for ways to adapt to a changing industry by setting themselves up to deliver specific services at an expert level. “You are safe if you are a specialist,” Kerr said. “If you’re doing a very generic, mainstream business, you need to be worried.” In his examples he referred to disruptors like Zenefits, Lemonade and Attune. The latter is a technology-enabled platform targeted at the SME commercial insurance market that was created in partnership by Hamilton Insurance Group, American International Group Inc. and affiliates of Two Sigma Investments LP. Richard Kerr, chairman and CEO MarketScout Corp., polled a crowd at the WIAA Education and Research Foundation state of the industry conference in Irvine, Calif. on March 23. Operators like these are all using big data to increasingly move toward selling insurance online to small businesses, he said. A company like Attune, Kerr said, only needs two things from a small business to offer it insurance: its name and its address. “Because every other dataset they need is out there,” he said. Michael Jans, founder and CEO of Agency Revolution, produced a dizzying array of statistics to drive home his point about the need for agencies to be on board with investing in better technology. 81 percent of consumers research online before shopping 65 percent of consumers read between four and 52 online reviews 98 percent of people check email at least once a day 39 percent of people check their email 10 times or more a day 87 percent of people say they check their email between midnight and 5 a.m. at least once a week The average person touches, taps or swipes their smartphones roughly 2,617 times in a day “In our business, if we want to reach people and touch people, we have to be where they are,” Jans said. Other figures in his online-focused talk included tidbits like: mobile web searches surpassed desktop searches more than two years ago; people spend an average of 87 hours per month browsing on their smartphones; and 44 percent of people in a recent poll said they have had zero interactions with their insurance agent in the last 18 months. Meanwhile insuretech startups are finding more ways to reach consumers and make it more convenient for them to buy insurance online, according to Jans who said he’s seen an increase in venture capital, conferences and media focused on insuretech. Jans did some research to see how many insuretech-themed conferences are planned for the near future. “I counted 20,” he said. “It’s an industry and it’s right next to us and it will disrupt us.” Insuretech and the insurance industry can best be thought of like the Jetsons and the Flintstones, according to Bill Hartnett, founder and president of Hartnett Advisors, a firm that offers strategic advice on technology usage. “The (insurance) business model goes back to Lloyd’s, which is just over 300 years old,” he said. “It really hasn’t changed materially since then.” Hartnett not surprisingly cautioned those listening to embrace technology and use it to their advantage, including considering tapping into big data. “All the data up through history, we’ll double that this year,” he said. Hartnett tackled an array of related topics in his talk, from autonomous vehicles to the Internet of Things to cognitive computing. All of which are going to change the way insurance is sold, he said. “The factory of the future is going to be a man and a dog,” he said. “It will be the man’s job to feed the dog, and it will be the dog’s job to make sure the man doesn’t touch anything.” Interested in Insurance Tech? Get automatic alerts for this topic. Subscribe

Keating Capital Investments

30 Investments

Keating Capital has made 30 investments. Their latest investment was in Mode Media as part of their Series F - II on August 8, 2013.

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Keating Capital Investments Activity

investments chart

Date

Round

Company

Amount

New?

Co-Investors

Sources

8/14/2013

Series F - II

Mode Media

$25M

No

4

8/12/2013

Series D

SilkRoad

$16M

No

6

7/23/2013

Debt

Deem

$12.5M

Yes

2

7/2/2012

Series G

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$99M

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10

6/22/2012

Secondary Market

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$99M

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0

Date

8/14/2013

8/12/2013

7/23/2013

7/2/2012

6/22/2012

Round

Series F - II

Series D

Debt

Series G

Secondary Market

Company

Mode Media

SilkRoad

Deem

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Amount

$25M

$16M

$12.5M

$99M

$99M

New?

No

No

Yes

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Co-Investors

Sources

4

6

2

10

0

Keating Capital Portfolio Exits

17 Portfolio Exits

Keating Capital has 17 portfolio exits. Their latest portfolio exit was SilkRoad on September 16, 2021.

Date

Exit

Companies

Valuation
Valuations are submitted by companies, mined from state filings or news, provided by VentureSource, or based on a comparables valuation model.

Acquirer

Sources

9/16/2021

Acq - Fin

$99M

1

3/21/2019

Acquired

$99M

9

1/17/2019

Acquired

$99M

4

7/26/2017

Acq - Fin

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$99M

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10

6/20/2017

Acq - Fin

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$99M

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10

Date

9/16/2021

3/21/2019

1/17/2019

7/26/2017

6/20/2017

Exit

Acq - Fin

Acquired

Acquired

Acq - Fin

Acq - Fin

Companies

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Valuation

$99M

$99M

$99M

$99M

$99M

Acquirer

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Sources

1

9

4

10

10

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