We could all use more good news right about now, and we’re happy to share some news of our own that will help us better serve you — our customers and partners:
The past few years have been marked by tremendous growth for Coalition. At the time of our last funding in September 2018, Coalition was a team of 20 operating out of 5 cities—today we number well over 100 with a presence in 19 cities in 5 countries. We’ve grown from serving 800 customers to just over 25,000 across the United States and now Canada, all the while demonstrably reducing cyber threats to our customers and saving them from tens of millions of dollars worth of losses. Our underwriting performance has followed a similar trajectory with a decrease in loss ratio year over year. All told, the growth and resonance of our service since the founding of Coalition a short 3 years ago is beyond our wildest of expectations, but it is only in the coming years that our scale and efforts to solve cyber risk—and to build the insurance company of the future—will become visible.
Over the next twelve months alone, we plan to double the size of our team, increase the number of customers we serve by an order of magnitude, scan over 5 billion devices 1.2 trillion times, and with that allow millions of additional organizations to safely harness the power of technology to grow their businesses. We built Coalition on the simple premise that when organizations—much less all organizations—face a shared risk, they should join together as a coalition (quite literally). We’re making this a reality by combining free tools to help organizations assess risk and prevent losses, dedicated risk management and incident response teams to mitigate losses, and the safety of insurance to help organizations pool resources and quickly recover financially after a loss. Today for cyber risks, tomorrow for others.
To sustain this level of growth and product development, and to better serve you — our customers and partners — requires investment. In this pursuit, we’re pleased to announce that we have raised $90 million in a funding round led by Valor Equity Partners with participation from Felicis Ventures, Greyhound Capital, and Coalition’s existing investors, who are among the world’s leading technology investment firms. This investment validates the opportunity ahead of us and positions us for the next chapter of our growth.
But before we write this new chapter, a bit about how we got here.
A seismic shift is underway
Seismic shifts fundamentally and seemingly suddenly alter the ways in which organizations and industries operate. We came upon a few such shifts when we founded Coalition in 2017. Although these shifts were already well underway, their strength has increased logarithmically each year.
These shifts are the massive movement of information and commerce online, and the rapid evolution by which organizations use and adopt technology, increasingly over the Internet and in the cloud. These shifts are impacting not only our customers, but also our very own industry: the insurance industry.
Had one started a business in 2017, as we did, they may very well have phoned up an insurance broker to purchase insurance, completed dozens of pages of insurance applications, and made decisions without completely understanding what had been purchased, why it cost what it did, and when it would ever be used. Despite this, we bought insurance because without it other organizations wouldn’t risk renting an office to us or signing a contract with us. Insurance is so intrinsic to today’s economic order that if it didn’t exist, someone would have to invent it. And it shows — the insurance industry is the 2nd largest in the world by many measures, with insurance companies accounting for one out of every ten constituents of the Fortune 500.
Today, it is inconceivable that we can’t make insurance work better and do more. Insurance doesn’t have to be a product that people buy for the sake of it, and only benefit from after something bad happens. What if insurance wasn’t just equated with after-the-event reimbursement, but could help prevent incidents from happening in the first place and provide support when loss events arise? There is no industry in the world with more data on managing risk, and yet so little has been done to turn that data into actionable intelligence.
What comes next
Insurance, at its core, is about the flow of money and data. Money to pay premiums and pay claims. Data to price risk and analyze claims. We believe that the greatest opportunities by far involve the novel use of data. Some of these opportunities are obvious: using technology to identify and convert clients more effectively, to deliver a better customer experience that matches the expectations of today’s consumers, to more accurately underwrite and price risk at the individual and aggregate level, and even to combat insurance fraud. Others may be less obvious, but are even more important such as turning data into intelligence that can help customers “engineer” their risk to avoid losses in the first place, or using data to improve claims services to help organizations respond to incidents. Insurance shouldn’t be limited to after-the-event reimbursement, but should prevent losses from happening in the first place, and contain them when they happen. With fewer losses, the industry can deliver more value to customers.
To achieve this vision, I once told the CEO of a large insurer that insurance companies needed to become tech companies, to which he told me, “[w]e are, just really bad ones.” When I think about what we’re going to use this funding for, it’s to build the insurance company of the future. One that is first and foremost a technology company, using data to constantly ask and answer the question “can we do this better?” This is our vision, and one that is now shared with thousands of insurance broker partners, tens of thousands of customers, and many of the world’s leading (re)insurers — and, of course, our investors.
A note of thanks
As we look back at the past three years, we are overwhelmed by how grateful we are to our steadfast customers, brokers, (re)insurance partners, and everyone else who has supported us and believed in us along the way. What might have sounded delusional to many three years ago (and they were probably right at the time!), may still be delusional today, but we’ve never been more committed to our purpose: to protect the value of our customers’ businesses, and to help them remain resilient in the face of dynamic and pervasive risks.
If this is a purpose you can get behind, we’re always looking for new team members — people who are passionate about solving cyber risk, and willing to tackle big problems. If that sounds interesting, check out our job postings.
Thank you again for your support over the past three years.