Maven funds invest a further £750,000 in honcho Follow-on investment will enable disruptive car insurance provider to further develop the platform and add new insurance product lines, supporting the creation of 10 jobs
Maven Capital Partners (“Maven”), one of the UK’s most active private equity firms, has invested a further £750,000, in disruptive car insurance platform, Honcho Markets Ltd (“honcho”). The funding has been provided by Maven VCTs (£322,500), North East Development Capital Fund, supported by the European Regional Development Fund (£322,500) and the Finance Durham Fund, established by Durham County Council (£105,000). The follow-on investment will support the business as it enters its next phase of development to launch the product nationally, add new insurance product lines and make significant enhancements to its platform. The investment will also support the creation of 10 jobs over the next 12 months, bringing the total staff numbers to 15.
honcho has developed an innovative platform which provides consumers with a transparent, cost- effective and engaging way of buying insurance products and services. Through honcho’s reverse auction marketplace, insurance companies bid for consumers’ business, which ensures a highly competitive quote and puts their interests at the heart of the transaction.
The firm raised £850,000 to fund its app launch last year, securing £200,000 more than it intended to raise, and closing the investment window nine days early. The initial funding round facilitated the platform build, development of mobile and web apps, Financial Conduct Authority (“FCA”) authorisation, and the launch of marketing campaigns.
The UK consumer insurance industry is the largest in Europe and the third largest in the world, with 911 authorised general insurance companies in the UK alone. The market is currently dominated by price comparison websites which are increasingly being scrutinised for a lack of transparency.
honcho’s management team has significant experience in the industry. CEO Gavin Sewell has over 20 years’ experience in banking and finance and has previously scaled and successfully exited his own FinTech start up. Commercial Director, Frank Speight, is highly experienced in financial services having previously worked in both banking and insurance for blue chip organisations. The business also has a strong board, with former CEOs and directors of KPMG, Northern Rock PLC, Quantum Pharma PLC and BT Global Services all advising the management team.
Alex Marsh led the deal for Maven, and said, “Car insurance is becoming increasingly expensive, particularly for young people, and honcho’s proposition will provide a fun, engaging and more cost-efficient way of purchasing insurance products via its unique reverse auction marketplace model.
“Gavin has assembled an exceptional management and advisory team around him and has made impressive progress since the Finance Durham Fund originally invested alongside the crowd. The engagement and interest honcho has already received from the insurance and broker community has been very encouraging and I’m excited to now see the product launch imminently, after months of hard work from the team.”
Gavin Sewell, CEO of honcho said “The past year has been an incredible journey for honcho and we are delighted to be able to today announce this significant investment to enable our next phase of growth. The team at Maven have been supportive and engaged partners since early 2018, and we are encouraged by their continued belief in the honcho proposition, and in our ability to disrupt what is becoming an ever more distrusted market.
“Our growth plans are already well advanced as we look beyond our imminent full launch into the car insurance sector and into our next markets. These will include bringing honcho’s disruption to the home and contents insurance market as well as to those of van and learner driver insurance. Our commercial team are already in negotiation with a number of potential market participants, including major household names, who see the value that honcho can bring to their businesses. This investment accelerates our next phase, and our talented team can’t wait to get started.”
Sarah Slaven, Operations Director of Business Durham, said: “Aykley Heads is fast becoming an important Fintech cluster for Durham, so it’s extremely exciting to be able to support honcho, one of the leading companies in the sector. Their base at Salvus House offers them the room to grow and provides them with a prestigious location in the heart of the city. We’ve supported them from the beginning and really look forward to continuing to watch them fulfil their potential with the support of the Finance Durham fund.”
Cllr Carl Marshall, Durham County Council’s Cabinet member for economic regeneration, said: “We’re delighted to once again be supporting honcho through our Finance Durham Fund and helping it to deliver new jobs. Our Powered by People campaign highlights what a great place County Durham is to do business and the exciting developments our investments are helping honcho to make are testament to that.”
Principals and key advisors to the transaction
- Legals – Paul Wigham, Watson Burton (Maven) and Richard Butts, Wardhadaway (honcho)
- Financial Due Diligence – Michael Cook, Irving Ramsay
- Technical Due Diligence – Mike Cessford, Intuitus
For media enquiries or any questions about the investment, please contact:
Maven Capital Partners
0191 731 8590
0191 731 8595
Morgan Rossiter (PR to Maven)
Richard Morgan Evans
020 3195 3240
020 3195 3240
Notes to Editors
About Maven Capital Partners UK LLP
Maven Capital Partners UK LLP (Maven) is a lower-mid cap private equity house focused on the provision of growth capital and mezzanine finance to SMEs across the UK. It is one of the most active private equity fund managers in the country, managing over £415 million of assets for a variety of client funds, including Venture Capital Trusts, UK regional debt and equity funds, and Maven Investor Partners – a syndicate of institutional, family office and experienced investors.
Headquartered in Glasgow, and with ten other offices throughout the UK, Maven has nationwide coverage of the market for SME finance and is introduced to around 400 deals per year through 20 regionally based investment executives. With over 50 staff and partners, Maven executes a range of private company transactions, offers hands-on proactive portfolio management to investee companies and provides a fully integrated back-office support function to client and third party fund managers. Since 2009 Maven has invested over £285 million in SMEs across the UK.
About Business Durham www.businessdurham.co.uk
Business Durham is the economic development arm of Durham County Council, delivering the environment for business and economic growth. It is a knowledgeable and trusted guide which connects businesses with the right funding, advice, and networks they need to grow and thrive.
Business Durham works closely with partners to encourage an enterprise culture, helping entrepreneurs to turn bright ideas into successful reality and students to develop enterprise skills to become our future business leaders. The organisation manages a portfolio of business property and excels in finding the right space for businesses to grow – commercial office space, modern laboratories and industrial property units.
Business Durham attracts capital and inward investment to the county, and develops an innovative economy that enables companies to grow and flourish. Business Durham builds long-term relationships to foster sustainable growth in businesses, raising economic aspirations and making Durham a place where business is done.
Media: For more information contact Lindsay Parker, Managing Director, Stride PR on 07590 775835
or email [email protected]
About The North East Fund
The North East Fund is a suite five venture capital and loan funds which was established in April 2018, to invest £120m in around 600 North East businesses in the period to March 2023. The fund managers provide business development advice and investment finance to small and medium sized enterprises based in the seven Local Authority areas of North East England: Northumberland, North Tyneside, Newcastle, South Tyneside, Gateshead Sunderland and County Durham. The programme encourages investment in and the commercialisation of new technologies, including low carbon technologies, as well as stimulating new business creation, private investment and entrepreneurialism in the North East, with a view to creating over 2,500 new jobs. The North East Fund has overall responsibility for the programme, which is delivered through five separate funds, each managed by independent, FCA regulated fund managers. Details of these, and up to date information on the progress of the programme, is available on The North East Fund’s website: www.northeastfund.org
The North East Fund has been established with funding from the North East of England European Regional Development Fund programme, the European Investment Bank and from returns on previous North East based, publicly supported investment funds. It is jointly owned by the seven North East local authorities
About the European Regional Development Fund
The North East Fund will receive up to £58,500,000 of funding from the England European Regional Development Fund as part of the European Structural and Investment Funds Growth Programme 2014-2020. The Ministry for Housing, Communities and Local Government is the Managing Authority for European Regional Development Fund. Established by the European Union, the European Regional Development Fund helps local areas stimulate their economic development by investing in projects which will support innovation, businesses, create jobs and local community regenerations. For more information visit https://www.gov.uk/european-growth-funding.
About the European Investment Bank
The European Investment Bank (EIB) will lend up to £60,000,000 to the North East Fund programme. The European Investment Bank is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals. For more information, visit: http://www.eib.org