Eurazeo, a number one international funding firm based mostly in Paris, has launched a EUR 200 million (US$213 million) insurtech fund because it expands its presence in Southeast Asia.
The VC agency has named Albert Shyy as Managing Director (Enterprise), who will lead the fund from its Singapore workplace. Shyy beforehand held numerous key roles at Burda Principal, STRIVE (previously GREE Ventures), and Lazada Group.
In Southeast Asia, Eurazeo invests in Sequence B and Sequence C stage firms. It just lately led a US$65 million Sequence B spherical of Qoala.
The VC fund additionally has places of work in New York, London, Frankfurt, Berlin, Milan, Madrid, Luxembourg, Shanghai, Seoul, and Sao Paulo.
e27 had a fast chat with Shyy concerning the VC fund’s plans in Southeast Asia.
Why did Eurazeo resolve to develop to Southeast Asia, though the EU area presents glorious alternatives and stays largely untapped?
Eurazeo has an extended monitor file throughout Europe and can proceed to spend money on that market throughout a number of levels and asset courses.
Nonetheless, the agency can also be in search of to internationalise, significantly within the US and Asia, to double AUM to US$60 billion within the subsequent 5 to seven years.
Southeast Asia has seen great development over the previous few years, and we’re excited to search for extra funding alternatives on this area because the market expands.
There are already a couple of traders specializing in the insurtech vertical within the area. Why does it want one other fund? What alternatives does it current to Eurazeo?
I feel we are able to complement lots of the current funds which can be energetic on this sector, which are usually extra targeted on the sooner levels. We see extra insurtech firms on this area develop past Sequence A, which feeds into our goal as development traders.
It might probably additionally deliver broader entry to worldwide markets from having our base in Europe and probably further swimming pools of capital from inside the Eurazeo platform down the highway.
Additionally Learn: Why Asia’s insurance coverage business is poised for collaborative disruption
Additionally, this fund can have a better give attention to the insurance coverage sector than most funds, which are inclined to have broader mandates. It would additionally allow us to construct deeper connections inside the business, together with our Restricted Accomplice, a worldwide insurer on this area.
I consider there’ll undoubtedly be alternatives for extra industrial or strategic partnerships with business gamers by means of this fund.
Are you able to share extra particulars concerning the fund — the philosophy, variety of investments deliberate, the common ticket measurement, and many others. Have you ever recognized any startups for investments but?
We’re development stage alternatives (Sequence B and C), with a typical cheque measurement of US$10-20 million+. Now we have the flexibleness to steer or co-invest. Now we have made the primary funding into Qoala, the place we led its Sequence B spherical.
Does the regional fund plan to spend money on startups throughout APAC or SEA?
The fund can make investments throughout APAC, however the main focus is on SEA. Ideally, about two-thirds of the investments could be made on this area
How is the general insurtech business rising in SEA? The place is it headed?
Whereas the sector is already sizeable (over US$100 billion gross written premium), insurance coverage penetration charges are nonetheless low throughout most of this area, particularly Indonesia, the Philippines, and Vietnam (lower than 3 per cent in every market, as per a report by BCG and ZA Tech final 12 months).
On the identical time, we’re seeing digitalisation speed up development/adoption as in lots of industries (extra knowledge to tell threat/pricing/product creation, potential to entry extra shoppers quicker and extra effectively, together with inside extra rural areas, and many others.). The most recent Temasek-Google-Bain report predicts the digital insurance coverage market to succeed in US$9 billion by 2025 from US$3 billion at present, so we see fast market growth within the digital/tech phase as effectively.
There are a number of insurtech fashions within the area. Do you see a vivid future for any fashions right here? Why?
It’s a bit early for me to say as I wish to dig deeper into every phase. Nonetheless, since penetration and consciousness are nonetheless so low in most markets right here, I feel merchandise that may construct consciousness/trial (comparable to micro-insurance) or these make the entire buyer journey a lot simpler (D2C, brokers, embedded fashions) could make a major affect.
Do you foresee potential purposes for crypto/blockchain/web3 within the insurtech vertical?
It’s difficult due to the excessive volatility and restricted oversight/regulation. However I feel the demand is actually there, and corporations will determine smarter methods to cost and canopy threat on this area.
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