Hellas Direct, a next-generation insurance company, announced the signing of a €7 million Series B funding round led by IFC, a member of the World Bank Group.
In backing Hellas Direct, a company supported by Endeavor Greece and led by Endeavor Entrepreneurs Alexis Pantazis and Emilios Markou, IFC joins the roster of all-star investors, which includes Endeavor Catalyst, Third Point LLC, former Goldman Sachs economist Lord O’Neill and private equity veteran Jon Moulton’s private investment vehicle, Perscitus LLP. Portag3 Ventures and a number of family offices also participated in an oversubscribed round, bringing Hellas Direct’s total equity raised to EUR 23.8m.
Hellas Direct will use the funds to further extend its footprint in the Greek insurance market, to broaden its offering of innovative, by-the-day microinsurance products and to accelerate its international expansion across emerging markets.
Founded in 2011 amidst a deep economic recession, Hellas Direct is Greece’s first direct-to-consumer online car insurance company, disrupting an inefficient insurance market. Hellas Direct has experienced exponential growth during its first four years of operation, even as Greece saw a 25% reduction in GDP and a 40% drop in insurance premia. Hellas Direct was selected into the Endeavor network in 2012, and became the first Greek company to receive funding from Endeavor Catalyst in 2015 when it raised an institutional investment round.
Modelling itself after Amazon, Hellas Direct aims to revolutionize the insurance value chain by adopting an extreme focus on operational excellence. Hellas Direct is a digital-first, full-stack insurance company, empowered by cutting-edge technology and artificial intelligence.
Its lean, more efficient cost structure allows Hellas Direct to compete head-to-head against traditional insurance powerhouses, offering a better product, at a significantly cheaper price to an underserved consumer. Hellas Direct employs a direct-to-consumer distribution model, driving further transparency and fairness in a historically opaque industry plagued with commissions and hidden fees.
“We are delighted to welcome IFC in our group of shareholders at Hellas Direct. The World Bank Group’s global expertise in financial services and their unparalleled experience in emerging markets investing, makes them an ideal partner for us, as we look to replicate our business model across borders and to further foster financial inclusion”, said Emilios Markou.
“We are excited to be teaming up with some of the world’s leading investors during our next phase of growth. We see this as a unique opportunity to fortify Hellas Direct’s position in a fast-consolidating market, to accelerate our organic growth and to selectively look at strategic acquisitions in the broader region”, added Alexis Pantazis.
As the lead investor, IFC’s strategy in technology, telecommunications, and financial services sectors focuses on technology-driven innovation in financial infrastructure, products, services, and their distribution. By mid-2017 IFC had invested over $320 million in equity and debt in early- and growth-stage fintech companies around the globe. With this investment, IFC aims to help to diversify Greece’s financial sector and increase the number of insurance holders in the country.
“The Internet, digital technologies and financial innovation are coming together to change the way we discover, buy and experience financial products. It gives IFC an enormous opportunity to participate in the economic upside of a massive disruption, while helping accelerate market dynamics and market composition, increasing market efficiencies and giving product choices to a very large underserved population. Such disruption affects all aspects of financial life, from the way people earn, to how they spend, from building personal wealth to protecting it through insurance.” said Andi Dervishi, IFC’s Fintech Global Head. “We are happy to be partners in Hellas Direct and help increase availability of insurance products, reduce prices to consumers and, in the process, increase insurance penetration in the country”.
“With its market leading technology, Hellas Direct is uniquely placed to offer consumers a better and more accessible insurance offering. We look forward to working with the team and to leveraging our global network to help Hellas Direct scale, both in Greece and abroad”, added Adam Felesky, President of Portag3.
Hellas Direct joins a number of other insurtech start-ups, such as Lemonade, Metromile and Zhong Ahn, looking to use technology in order to shake up a laggard insurance industry. Insurtech has been one of the hottest areas of venture capital investing over the past couple of years, with Sequoia, Google Ventures and General Catalyst playing a particularly active role. Insurance incumbents remain largely unchallenged with age-old barriers to entry such as the need for highly-specialist knowledge, stringent regulation and a significant upfront investment in the technological capability needed to truly disrupt the market.
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, we use our capital, expertise, and influence to create markets and opportunities in the toughest areas of the world. In FY17, we delivered a record USD 19.3 billion in long-term financing for developing countries, leveraging the power of the private sector to help end poverty and boost shared prosperity. For more information, visit www.ifc.org.
About Third Point LLC
Third Point LLC is an SEC-registered investment advisor based in New York City. Founded in 1995 by CEO Daniel S. Loeb, the firm follows an event-driven approach to investing across the globe. For more information, visit www.thirdpoint.com.
About Endeavor Catalyst
Endeavor Catalyst is the innovative co-investment fund of Endeavor, set up to invest exclusively in Endeavor Entrepreneur-led companies and to sustain Endeavor’s long-term operations in a mission-aligned way. Since launching in January 2012, Endeavor Catalyst has raised over $100M in philanthropically donated and invested capital, and invested into 64 Endeavor companies in 19 countries. To date, Endeavor Catalyst has co-invested alongside a number of leading venture capital and growth equity funds, including Accel Partners, General Atlantic, NEA, Sequoia Capital and Tiger Global. Investments include Globant (NYSE: GLOB) in Argentina and Yemeksepeti.com (acquired by Delivery Hero) in Turkey.
About Perscitus LLP
Perscitus LLP is the London-based investment consultant for Jon Moulton’s private investment vehicle. For more information, visit www.perscitusllp.com.
About Portag3 Ventures
Portag3 Ventures is an early-stage investor dedicated to backing innovating financial services companies working to benefit all consumers. Exclusively sponsored by Power Financial Corporation, IGM Financial Inc. and Great West-Lifeco Inc., Portag3 gives new ideas a unique environment to grow. Portag3 makes longer-term commitments, and combined with its industry intelligence is an ideal partner for the ambitious and creative entrepreneur. For more information, visit www.p3vc.com.