New report – a collaboration between Gallagher Re, Gallagher and CB Insights – reveals the general downturn in investing from 2021 has not only funneled a market correction but has forced a change of makeup in InsurTechs themselves
Rolling Meadows, IL (Aug. 3, 2023) – Gallagher Re is pleased to announce the release of its Q2 2023 Global InsurTech Report.
In this report, we review global InsurTech funding and investment quarter over quarter. We continue our focus for the 2023 series on the lifecycle of InsurTech funding, with this report spotlighting early-stage acceleration [Series A].
Since the height of InsurTech investing and valuations, we’re now experiencing a very healthy inflection point focusing on sustainability, which is reflected by a downturn of speculative investment capital. InsurTechs that focus on clear commercial outcomes are gaining more traction than those trying to offer their technology (only) as a product.
Key Findings for Q2
- Global InsurTech funding fell 34.0% quarter on quarter, from $1.39 billion to $916.71 million.
- Companies raising capital within the early-stage acceleration category raised $134.49M — or 14.7% of total InsurTech funding.
- Q2 23 saw 43 corporate InsurTech investments from (re)insurers, of which 34.9% were directed toward US-based InsurTechs — more than any other country.
Access the full report here.
2023 InsurTech Funding Life Cycle Q2: Early-Stage Acceleration
With the quarter on quarter ‘bouncing back’ in terms of Q1 investment levels into InsurTech, one can infer that there is no shortage of investor interest or appetite for the right InsurTech grey matter.
In fact, the recent uptick of early-stage investment (the latter stages of 2022 being significantly high) and relative lack of mega-round deals to otherwise prop up total investment figures are a clear sign that this remains an extremely healthy vibrant space that continues to grow and mature. Quantitatively, on a quarterly basis, InsurTech can appear quite volatile, but over a longer period of time, the trends developing are in line with a naturally evolving space that was once associated with a rush to capitalize on quick equity returns, but is now increasingly associated with longer-term sustainability.
Qualitatively, we are also now observing something far more interesting. The investors (and their capital) and the InsurTechs themselves (or at least their focus) are also changing. The general downturn in investing from 2021 has not only funneled a market correction but has forced a change of makeup in InsurTechs themselves. First and foremost, the type of grey matter attracting investor attention is changing. InsurTechs focused on clear commercial outcomes for themselves and for their potential incumbent partners are gaining more traction and attention relative to those that are trying to offer their technology (only) as a product. We have evolved into the era of outcomes – the ‘what’, if you will, and no longer the ‘how’.
Access the full report here.
About Arthur J. Gallagher & Co.
Arthur J. Gallagher & Co. (NYSE: AJG), a global insurance brokerage, risk management and consulting services firm, is headquartered in Rolling Meadows, Illinois. The company has operations in 68 countries and offers client service capabilities in more than 150 countries around the world through a network of correspondent brokers and consultants. For more information, visit www.ajg.com.
SOURCE: Arthur J. Gallagher & Co.
Tags: Arthur J. Gallagher, funding, InsurTech, seed funding
