Allianz expands VC fund to $1.1b for tech, insurance investments

Allianz SE
The Allianz SE logo sits on a top of a building in Berlin, Germany. Photographer: Krisztian Bocsi/Bloomberg

European insurer Allianz SE is increasing the size of its tech investment fund to 1 billion euros ($1.1 billion), making it one of the largest corporate-backed venture funds in Europe.

Allianz X was launched in 2016 with a 430 million-euro checkbook and has done about 15 deals, including an investment in Indonesian ride-hailing firm Go-Jek, German mobile bank N26, and U.S. insurance startup Lemonade.

The new funds will target startups where Allianz sees some future cross-selling or use case, the company said in a statement Wednesday. Prior to its investment last year, Allianz Indonesia was offering insurance products to Go-Jek’s riders and customers.

Allianz X now has the option to make larger investments, said Chief Executive Officer Nazim Cetin, and has plans to hire new staff. The fund did not disclose any performance figures, but added that the current value of the portfolio exceeds the initial investment.

Some of Europe’s other major corporate-backed VC funds include that of BMW AG, which in 2016 announced it was creating an investment vehicle to spend up to 500 million euros over ten years. The same year saw Siemens AG pledge 1 billion euros for startups via its next47 venture.

The increased appetite for venture deals mirrors the desire of Allianz Chief Executive Officer Oliver Baete to hunt out acquisition targets. Originally conceived as away of backing startups, Allianz X switched focus in late 2017 to later-stage firms in areas such as mobility, wealth management, and cyber security.

Insurers have been grappling with how technology will impact them. Deloitte, in its 2019 insurance outlook report, warned that “most insurers have long struggled with innovative product development.”

Allianz X is targeting how people may change their driving behaviors — and therefore how they take out policies — as a key market, investing in Nauto, a startup that makes technology to help develop autonomous cars, and Urgent.ly, an app-based startup that provides breakdown cover.

Bloomberg