(Image source: Extend homepage.)
Extend, a San Francisco-based API-first solution that allows any merchant to offer extended warranties and protection plans on the products they sell to their customers, has purchased several agreements and assets related to administration of warranty programs in the United States from Affinity Insurance Services, Inc., an affiliate of Aon plc. With the addition of these capabilities, Extend possesses deep industry expertise and robust administration capabilities, offers a technology first, full stack extended warranty program for merchants, and a digitally native elevated customer experience. As part of the transaction, Pedro Rodriguez, a 25-year industry veteran and former SVP, Aon Warranty Solutions, will join Extend’s senior management team as Senior Vice President of Insurance and Strategy.
Extend also announced that it has secured $16.4 million in financing led by GreatPoint Ventures (San Francisco). Venture firms Pritzker Group Venture Capital (Chicago), Lightbank (Chicago), and Shah Capital Partners (Santa Clara, Calif.) are also participating in the round along with prominent investors Rick Smith (ex-CEO Equifax), Michael Marks (ex-CEO Flextronics and CEO Katerra), Jason Robins (DraftKings CEO), and Erik Torenberg (Village Global). Extend says that it will use the funding to scale operations on pace with its rapidly expanding list of clients. The vendor reports that merchants that are currently using and signed up to utilize Extend as their exclusive extended warranty provider collectively have annual gross sales of over $11.5 Billion. These companies include a national auto parts retailer, SoClean, August Locks, 1More, Club Cadet, Wynd, Zebit, Coinmine, Polycade, RealTruck, DS18, Outcast Garage, and New Air.
In the wake of the transaction and new funding, Extend says it will focus on expanding its product development and brand recognition as well as continuing to transform extended warranty offerings by placing both the retailer integration and the customer experience at its core.
Rapid Integration of Warranty Plans for Merchants
Extended warranties represent $45 billion in plans sold annually; however, it is mostly large enterprises like Amazon, Apple, Costco, and BestBuy who are able to offer, and benefit from, selling these products to their customers. Extend allows any merchant to rapidly integrate and offer customer-friendly extended warranties and protection plans on the products they sell. The company has designed, built, and launched applications for Shopify and Magento as well as onboarded merchants through their own APIs.
“Before Extend, extended warranties were only accessible to the top 1 percent of merchants and often had a negative reputation with consumers, which left a huge portion of the market unable or unwilling to offer protection plans,” comments Woodrow Levin, Founder and CEO of Extend. “Extend’s rapid growth is a testament to the increasing demand for an extended warranty solution that all merchants can use and customers can trust.”
Extend works with a network of insurance carriers to help merchants of all sizes offer extended warranty options to consumers directly on their websites, or in brick and mortar stores, ultimately helping brands and retailers drive incremental bottom line net income, increase overall purchase conversions, and create loyal customers with a digitally native customer experience. The company’s Intelligent Offer Engine uses machine learning to dynamically test price, different copy, content, placement, and additional parameters to optimize purchases of the extended warranty offers. This has resulted in Extend delivering protection plan attach rates that are double the current industry average for legacy online protection plans.
“Combining the technology engine of Extend with these assets and program design expertise allows us to bring together Extend’s best of breed front end technology with robust underwriting and administration capabilities,” comments Pedro Rodriquez, Extend’s SVP of Insurance & Strategy. “The ability to offer speed to market and ease of integration to e-commerce and brick and mortar merchants is what sets us apart from legacy providers, and is core to our growth strategy.”
Serving an Industry Yearning for Innovation
“The acquisition from Affinity Insurance Services, Inc., an affiliate of Aon plc clearly sets up Extend to be a dominant player in extended warranties, especially in a rapidly growing environment of online sales,” comments Andrew Perlman, Managing Partner, GreatPoint Ventures. “We’ve been amazed with how fast Extend has grown. It’s a testament to the strength of the company’s leadership and technology. This is an industry that has been yearning for innovation and protection plans that customers can trust. It’s about time that every manufacturer can now provide the Apple Care type experience that they know customers want.”