Bitesize InsurTech: Gryphon
June 23, 2017 Chris Sandilands
Gryphon is a soon-to-launch startup life insurance company in the UK.
Gryphon caught our eye this week when it was reported that it had raised £180m. Compare that with the $60m raised by Lemonade or Trōv’s $90m and you realise that this is a very big number. Investors are Leadenhall Capital, a specialist insurance investor, and Punter Southall, the pensions group.
The company has been set up by Dan Pender and Simon Davis, former executives at Prudential, Zurich, Guardian Life and other firms. Their mantra is to “protect more families”.
The ambition is to use technology to deliver a better experience across the full value chain, although the company is not currently disclosing how that will be the case (or indeed what their brand is going to be – Gryphon being the holding company name).
In contrast to Lemonade, Gryphon is not going to seeking to “disrupt” the whole market. Instead they are going to put their products through existing channels such as advisors.
The business was started in March 2016 and currently has 50 employees. They are hoping to get regulatory approval in time for a 2017 launch.
The Oxbow Partners view
We don’t know enough about Gryphon’s business model to be able to provide much comment on the insurance context this week.
Instead, here are three things to look out for when they launch:
1) £180m is an awful lot of money to raise pre-launch, so we have to assume a fair chunk will be used as risk capital for underwriting – and possibly for acquisitions. Is this going to be a platform for some kind of life intermediary roll-up? (Remember that investor Punter Southall knows a fair bit about building a business “cluster” in this space.)
2) Is this an InsurTech or a more classical business promoting a tech angle? The business – if it works – could be a good reminder to entrepreneurs that you don’t have to be disruptive to succeed, but “simply” execute the existing model better.
3) Can they deliver the growth needed to cover a £180m investment? We have often said that we are in awe of the Lemonade marketing machine, and this has delivered fast growth over the last 8 months (see our analysis). Gryphon has a more “technical” management and investor team than Lemonade – will they be able to deliver the “buzz” required to accelerate the business?