(Image credit: Simi Luft/Kolibrik.)
EIS (San Francisco), a core and digital platform provider for insurers, has announced a growth investment of more than $100 million from TPG (New York), a global alternative asset firm. TPG (San Francisco) is investing out of TPG Tech Adjacencies (TTAD), its fund focused on flexible capital solutions for the technology industry. The new funding will be used to continue to accelerate product development across the spectrum of risk, health, and wealth, and support geographic expansion, according to an EIS statement. The companies declined to disclose additional terms of the transaction.
“Digital transformation of insurance has been a longstanding theme for TPG, and we believe EIS is a solution built for the future of the industry,” comments Nehal Raj, Partner, TPG. “Alec [Miloslavsky, founder and CEO, EIS] and his team have built a powerful platform that enables insurers across the globe to operate more effectively, become more customer-centric, and achieve better speed to market. We look forward to working closely with the company to build on their strong momentum.”
TPG’s $100 million growth investment is an important milestone for EIS, according to Donald Light, a Director in Celent’s (Boston) North America Property/Casualty Insurance Practice. “EIS competes in multiple insurance sectors including: property/casualty; group and voluntary benefits, life and annuities, and others,” Light comments. “EIS is also active in multiple global regions. It will be interesting to see where TPG’s investment and corporate-level involvement will be focused among these sectors and geographies.”
Founded in 2008, EIS pitches itself as an insurance software company that enables leading insurers to innovate and operate in faster, more secure, and agile ways. The company describes its EIS Suite as an open, flexible platform of core systems and digital solutions that facilitate the acceleration and scaling of innovation, the more rapid launch of insurance products, delivery of new revenue channels, and creation of powerful customer experiences. “With thousands of open APIs, the EIS platform gives insurers across all lines of business the freedom to connect to—or serve as a hub for—a vast ecosystem of InsurTech and emerging technologies,” the EIS statement says.
“We are excited to partner with TPG as we continue to bring our best-in-class, cloud-native suite of technology solutions to insurers across the globe,” comments Miloslavsky. “The team at TPG is aligned with our ambitious growth strategy and their longstanding track record, industry relationships, and deep expertise make them an ideal partner for EIS as we propel our business forward. The investment will help us to continue to meet growing client demand as insurers transition from outdated ‘modern legacy’ systems toward a platform that provides the flexibility, speed, openness, and security that today’s highly competitive market requires.”
EIS claims unique status as a multiline platform combining depth in relevant lines of business, the modern architecture of InsurTech, and proven scalability that it says supports the largest API-first, cloud-native core system implementation in the world. EIS serves clients across North America, Europe, and Asia and says the platform-agnostic EIS Suite can be deployed on AWS, Microsoft Azure, and Google Cloud.
Of the significance of the growth investment, Tony Grosso, EIS’s SVP of Global Marketing and Communications quipped to IIR, “Tonight I will say a couple of prayers for our competitors. We were under-funded in sales and marketing. We have the best technology in the market, but we didn’t have the ability to be as loud and available to the market as we should have been.”
In explaining TPG’s interest in EIS, Grosso says that the software company has proved that the European market finds its software and business model extremely attractive. “We launched in Europe 14 months ago and we’ve already landed two customers, beating our major competitors,” Grosso said. “TPG believes in our technology and in our story. They believe in the management team and our very aggressive growth plan. They believe in the things we stand for—being multiline and being able to support all lines of business on the same platform. We see the future of insurance as being customer-centric, which is a big divergence from modern legacy insurance systems.”
Grosso says that EIS has often faced criticism for its decision to develop a single platform for multiple lines of business, frequently resulting in advice that the company should find its market niche by focusing on a single line of business. “It’s been a challenge because, in some ways, we’ve been ahead of the industry,” he said. “But now that the industry is starting to catch up, our value proposition is becoming more evident.”
TPG Supporting Existing Strategy
EIS was one of the few remaining properties with growth potential that was yet to make a major investment transaction, Grosso notes. He stressed that the TPG’s investment is an affirmation of EIS’s technology and its existing strategy. “TPG is there to provide capital and expertise to help us with growth,” he said. “However, they’re not helping us with our road map, they’re not changing our business plan, which is to remain multiline across multiple geographies—the U.S., Europe and Asia—and they’re not changing the management team.”
Some of TPG’s investments in the insurance space have included Vertafore, a provider of insurance distribution technology, and CCC Information Services, a provider to the automotive, insurance, and collision repair industries. The firm has been an active investor in technology since its inception, with current and past software investments including C3 AI, Kaseya, McAfee, Planview, ThycoticCentrify, WellSky, Wind River, and Zscaler.
GCA acted as financial advisor to EIS on the transaction. William Blair acted as financial advisor to TPG, and Kirkland & Ellis served as legal counsel.