INSURTECH DISRUPTOR HONCHO CLOSES £1.2m INVESTMENT ROUND
- Over 600 crowd investors invest via Crowdcube crowdfunding platform
- Existing investors Finance Durham Fund and North East Development Capital Fund invest further
- Specialist insurtech investor Insurtech Gateway invest in honcho
- Van and learner driver insurance marketplaces to join car insurance this spring
9th April 2020
Insurtech startup honcho – provider of the UK’s first reverse auction marketplace for financial services – have completed their latest investment raise as their mission to revolutionise how consumers buy insurance continues. The Durham-based innovator has brought a further £1.2m of investment into their business with participation from crowd investors, Insurtech Gateway and existing investors Finance Durham which was established by Durham County Council and overseen by Business Durham, and the North East Development Capital Fund (“NEDCF”), supported by the European Regional Development Fund, as they embark upon their next phase of growth.
Between 2018 and 2019 honcho raised £1.8m from a combination of crowd investors on Crowdcube, angel investors and investment house Maven Capital Partners (“Maven”), who manage both Finance Durham and NEDCF. This enabled the start-up to launch their car insurance marketplace last autumn, and to start work on preparing for expansion into new insurance markets in 2020. Thousands of consumers have signed up and used honcho since launch, with 12 insurance providers now active on the platform, selling policies from 30 insurers including Axa, Aviva, Ageas and Zurich.
honcho’s latest investment round has seen further investment from Maven’s managed funds alongside another successful crowd raise on Crowdcube where over 600 private investors took the opportunity to buy shares in the insurtech disruptor.
As part of this raise honcho also welcomes investment from venture capital firm Insurtech Gateway, the London-based incubator and fund with an exclusive focus on the insurtech sector. Insurtech Gateway were formed in 2017 and have incubated some of the insurance sector’s most exciting new tech businesses including By Miles, FloodFlash and Collective Benefits.
Commenting on the investment, honcho CEO Gavin Sewell said:
“Raising investment is one of the most challenging aspects of running a startup, and we’re delighted to have achieved this £1.2m raise with the continued support of Maven and with further investment from the crowd. We’re also thrilled to welcome Insurtech Gateway to the honcho family. As specialists in our sector they will bring an immense amount of support to honcho as we enter our next phase of growth. Insurtech Gateway’s expertise across the sector extends from technological capabilities to expertise on products and consumer acquisition, and we’re looking forward to working with them.”
Sarah Slaven, Interim Managing 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 continue 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 Finance Durham.”
Insurtech Gateway CEO Richard Chattock said:
“Today’s consumers rightly demand fairer, more transparent insurance. honcho’s new model delivers this. It reduces commissions, eliminates bias and allows consumers to make purchasing decisions on product as well as price. We’re delighted to be joining honcho’s journey to revolutionising personal lines insurance distribution.”
Michael Vassallo, Investment Director of Maven Capital Partners, said:
“We’re delighted to support honcho’s latest fundraise, having backed the business originally in 2018, we continue to support Gavin and the team as they grow the platform, making significant enhancements and adding new insurance product lines.”
In addition to honcho’s car insurance marketplace, which itself has doubled in size since launch and is due to grow by over a dozen more insurance providers over the coming weeks, honcho’s plans for 2020 include the launch of dedicated new reverse auction marketplaces for van insurance and for learner driver insurance. As with their 2019 launch, pioneering social marketing agency Social Chain are poised to lead the charge in introducing honcho to these markets.
Talking about honcho’s 2020 growth plans, chief product officer Tom Spence said: “There are over 4 million vans on the UK’s roads and the nation’s van drivers have been at the mercy of price comparison websites for their insurance for far too long. honcho’s van insurance marketplace will launch this spring and we’ll be bringing long-overdue transparency and fairness from some of the UK’s leading van insurance providers.
“Following van insurance, we’ll be extending honcho to learner drivers. When you’re learning to drive the last thing you need is to navigate the mysterious maze of learner insurance to then get lumbered with something that isn’t right for you. honcho is going to change all of this with our special learner zone in the spring, bringing our unique reverse auction marketplace to both temporary and annual learner driver insurance.”
The honcho app is available to download now for Apple and Android phones via the App Store and Play Store and is available via a web browser at https://gethoncho.com/.
For more media information, interviews or images, please contact Graeme Stoker at honcho – [email protected]
NOTE TO EDITORS
honcho is the first online reverse auction marketplace for financial services and is revolutionising the way people buy products and services, saving them time and money.
A reverse auction is where consumers receive bids and become the focus of the auction. Companies compete against each other to win consumers’ custom, which is how we think it should be.
Disruptive and innovative, honcho launched into the car insurance market in autumn 2019 and will expand into the van and learner driver insurance markets in 2020.
honcho is a founding member of Insurtech UK, the industry body for disruptive insurance technology businesses, and is a member of BIBA, the British Association of Insurance Brokers. They are also authorised and regulated by the Financial Conduct Authority.
For more information, visit https://gethoncho.com/.
About Insurtech Gateway
- The only investor with FCA insurance authorisation.
- Fund invests from Seed to Series B.
- A one-stop-shop for founders: underwriting paper, investment capital, regulation and incubation.
- Partnered with leading global tech companies.
- Collaborating with 19 insurance and reinsurance companies.
The Gateway would like to meet early-stage founders with game-changing ideas or products, and progressive (re)insurers who are interested in collaboration.
For more information visit https://insurtechgateway.com/.
About Maven Capital Partners UK LLP
Maven Capital Partners UK LLP (Maven) is an independent private equity house focused on the provision of flexible equity and debt funding for UK SMEs, and one of the most active managers in the UK having invested over £500 million in British businesses since 2009.
Headquartered in Glasgow, and with eleven offices throughout the UK, Maven has around 100 investment and support professionals providing a truly nationwide coverage. Maven has £660 million funds under management and ready to invest, and manages assets for a variety of client funds, including Venture Capital Trusts, UK regional fund mandates, and Maven Investor Partners, a syndicate of institutional, family office and experienced investors.
For more information, visit www.mavencp.com
About The North East Fund
The North East Fund is a suite of 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
About Business Durham
Business Durham is the economic development arm for County Durham, working on behalf of Durham County Council to deliver 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.
For more information, visit www.businessdurham.co.uk