The insurtech space has been through a rough patch. About seven years ago, early insurtech companies promised to disrupt the insurance industry with new technology, but today, most are either being acquired or languishing in the public markets.
Fortunately, insurtech has discovered a new wave in the past few years: “embedded insurance.” Insurance startups are having success helping third-party companies “embed” insurance products into the customer journey to increase sales and retention rates – instead of buyers actively seeking insurance, insurance may appear as an add-on when customers purchase flights ,For example. Investors also appear to be excited about this model, although they have made it clear that good economics and healthy traction are key factors for new startups in the space today.
Carevoice, an embedded insurance solutions provider that started in Shanghai and now operates in 15 countries, has clearly made the numbers attractive to investors in the space. The company just raised $10 million in a Series B round led by UK-based Apis Insurtech Fund I, which contributed the bulk of the round.Investment brings The company’s total capital raised is approximately US$20 million.
This is noteworthy given that venture capital investment in new startups has slowed over the past year. In 2023, U.S. digital health startups raised a total of $10.7 billion in 492 deals, the lowest amount since 2019, according to Rock Health, a seed fund focused on health technology.
The slowdown in financing has also hit The Carevoice, although it has weathered the storm by delivering healthy cash flow. Co-founder and CEO Sebastian said the company had received Series B funding commitments by mid-2022. But just as the market was improving, one of the investors became “valuation sensitive” and slashed the startup’s revenue multiple. Gaudin told TechCrunch.
“We have to adjust our fundraising strategy,” he said. “We are on the right path to profitability, so we are rolling up our sleeves and working to become cash flow neutral from the third quarter of 2022 to now.”
He said the company will double its revenue by 2023, reaching $10 million this year, which includes recurring licensing fees and one-time implementation fees.
“So ultimately, we are in a good position to close the Series B round,” Gaudin added.
Providers of embedded health solutions like The Carevoice may find themselves competing with traditional IT and consulting services companies such as Tata’s TCS. But Gaudin believes that healthcare providers who choose to outsource their software needs will eventually realize the significant “cost and time” involved in “limited results.”
“Maybe two or three years ago [customers] See anything.and [in terms of] The cost is probably several million dollars. Then they get stuck. Health system management is still out of scope, which means ultimately, these custom software companies won’t be managing the different health technologies, working with them and introducing them,” he said.
Gaudin said Carevoice can launch the first version of its health tech solution in just three months, with the design process taking two to four weeks and development taking another two months. For one of its largest customers, MetLife, the startup offers its 360Health app features such as disease detection via facial scans, access to a network of nearby exam centers, and health care across physical, mental and cognitive Health prevention.
The Carevoice, which has a team of about 40 employees, plans to use the new funds to expand partnerships with insurance companies in Asia, Europe, the Middle East, Africa and the Americas, and to invest in CareVoiceOS, a next-generation operating system that is built for insurance companies of.
