Revaia + FASST: Paving the Way for European Insurance Transformation
Revaia’s announcement that we are leading FASST’s €27 million Series B financing round marks a key milestone in our mission to back visionary companies accelerating digital transformation in critical sectors.
We’re excited to join forces with Bpifrance's Large Venture fund to support the next phase of growth for a company poised to shape the future of European Insurance.
Our investment in FASST is a recognition of the company’s innovative approach to digitizing the insurance distribution landscape, creating a strong growth trajectory that aligns closely with Revaia’s broader investment thesis in the vertical SaaS space.
We see this investment as a strategic partnership aimed at leveraging FASST’s technological moat, customer-centric approach, and proven value in the insurance industry to fuel both national and European expansion.
Let’s break down our reasoning behind this deal.
The Big Insurtech Picture
We believe that the Insurance tech market presents significant opportunities and is rapidly evolving thanks to substantial demand for digital transformation solutions within the insurance industry.
There are several key factors shaping the Insurance tech market in our view:
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The insurance industry is a $7 trillion sector1, yet it has historically lagged in digital adoption. In 2024, insurers are expected to invest $60 billion in software2 with $12 billion focused on vertical-specific solutions like FASST’s platform. B2B Insurtech accounts for 68% of total Insurtech funding since 2019, demonstrating investors' confidence in specialized solutions that can modernize the insurance sector.
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These incumbents are turning to cloud-based solutions. The goal is to streamline operations, reduce inefficiencies, and enhance user experiences, ultimately accelerating overall insurance product distribution. The industry is faced with the challenge of disentangling and digitizing the spaghetti bowl of insurance operations, something that is critical for the future of the industry. AI offers a potentially efficient way to tackle a number of issues, including security, climate change, distribution, user experience, and data management. AI applications are emerging across the insurance value chain that offer a level of automation that could strike a balance between growth and profits.
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The B2B Insurtech space has shown resilience, with public market indices up 50% in value for B2B Insurtech companies in recent years3. This performance is primarily due to the stability and critical nature of B2B services that support core operational processes, such as distribution, underwriting, and claims management. In addition, B2B companies are more likely to secure long-term contracts and benefit from recurring revenue streams.
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Sustainability considerations are becoming increasingly central in the Insurtech sector. Insurtechs focused on climate-related risks, for example, offer solutions like carbon credit insurance, sustainable agriculture insurance, and resilience bonds for climate adaptation. These innovations align well with insurer goals to manage and mitigate risks associated with climate change while promoting eco-friendly behaviors among policyholders.
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European B2B Insurtech funding is concentrated in the UK, DACH (Germany, Austria, and Switzerland), and France, where leading companies dominate the funding landscape4. Private equity and venture capital have demonstrated a strong interest in mature B2B Insurtech players, particularly those with proven business models and recurring revenues. The Insurtech investment landscape is expected to grow, with established players likely to pursue M&A to expand product portfolios and scale internationally. Meanwhile, companies offering platforms that integrate with legacy systems or provide “plug-and-play” digital solutions are expected to attract significant attention.
Combine all of these trends and it seems clear that the B2B Insurance tech market offers considerable growth potential. This also suggests a well-defined path for investors and Insurance tech firms to capitalize on unmet needs in a traditionally underserved market.
The FASST Business Model
Xavier Favre and Yasser Echoukry co-founded FASST in 2017. The company was originally incubated in a major insurance firm where Xavier and Yasser had worked for more than a decade.
Since then, FASST has grown into a critical player in the Insurance sector, offering a unique platform that digitizes the distribution and subscription processes for insurance companies.
The platform is designed to be modular and adaptable, offering a suite of products that cater to various segments of the insurance market, including individual health insurance, employee benefits, and general insurance. Its offerings range from SaaS-based solutions to services, with a growing proportion of revenues coming from recurring platform subscriptions.
FASST’s primary focus is on simplifying and automating the insurance product lifecycle, from distribution to subscription. It is particularly known for reducing the time-to-market for insurers, enabling faster and more efficient sales processes.
By offering multi-channel, multi-product solutions, FASST has built a robust, scalable platform that serves a broad client base, ranging from large insurers to mid-market players. This versatility allows FASST to position itself as a mission-critical partner for insurance companies undergoing digital transformation.
Why Revaia Invested
Having targeted the B2B Insurance tech market, FASST crossed our radar because it serves the digitization of large insurance companies and middle-market players. This strategy positions it to capitalize on the growing demand for digital solutions in the B2B insurance space.
More concretely, several things about FASST really stood out to us:
1. The Team: FASST is led by Xavier, Yasser, and CTO Hubert Bettan, who joined shortly after the company was founded. They are a complementary team of seasoned insurance and tech veterans with a proven track record when it comes to execution as well as a deep understanding of the insurance industry. They have created a company that innovates rapidly while maintaining a customer-centric approach. Their powerful vision and ability to build lasting relationships position FASST as a key player in insurance software.
2. Strong Product-Market Fit: The company’s PMF and the technological moat it has built around its platform are impressive. FASST’s ability to digitize and streamline complex insurance processes, such as distribution and subscription, provides a clear return on investment for its clients. The company’s modular architecture, combined with its headless approach, allows insurers to customize and scale the platform according to their specific needs.
3. Technological Leadership: FASST’s R&D efforts have led to the development of cutting-edge tools that address the changing regulatory environment in the insurance industry. This positions FASST as a long-term partner for insurers looking to stay ahead of regulatory changes, further solidifying its importance in the market.
4. Scalable and Recurring Revenue Model: The company operates a highly scalable, SaaS-driven platform, with recurring revenues expected to account for a growing share of total income.
The company’s ability to secure long-term contracts with leading insurers, combined with its high net retention rate underscores its ability to retain customers and expand its offerings within existing accounts. This strong upsell potential, coupled with a low churn rate, makes FASST a highly attractive investment for Revaia, which is focused on long-term value creation.
5. Strategic M&A and European Expansion: Revaia’s investment is also motivated by the potential for FASST to expand beyond the French market and become a leading Insurtech player across Europe with acquisitions that would not only expand FASST’s geographic footprint but also enhance its product offering by integrating complementary technologies.
Revaia will facilitate this expansion by leveraging our network and expertise to help FASST navigate the complexities of international growth, secure additional funding, and execute strategic acquisitions.
As the world of insurance continues to transform, Revaia’s investment in FASST is a step toward a future driven by innovation and impact. This partnership aligns with our strategy of backing European tech companies with the potential to lead their sectors and expand internationally.
FASST’s strong positioning and growth potential make it a promising leader in European Insurance tech—a testament to the remarkable work of its founders and team. We’re thrilled to support FASST in shaping the digital future of insurance.
1 Source: Swiss ReSigma
2 Source: Gartner
3 Capital IQ, data as of July 2024
4 Klein Blue Partners