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.”
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.
