Envelop Risk, the UK-based cyber re/insurance managing general agent, announced a Series B investment of $130 million, led by SoftBank Vision Fund 2.
The financing will facilitate Envelop Risk’s plans to expand its proprietary machine-learning and data-driven underwriting activity in London and Bermuda, with hopes to fuel growth into new markets globally and beyond cyber re/insurance.
As part of the transaction, Neil Cunha-Gomes, investor for SoftBank Investment Advisers, will join Envelop Risk’s board of directors. The transaction is planned to close in October 2021, subject to shareholder approval.
Envelop Risk underwrites bespoke reinsurance for global insurance firms, differentiating its products through the application of advanced cyber analytics, enabling customers to manage their portfolios with greater precision. The firm can offer reinsurance capacity combined with pricing technology, policy wording, and claims support to introduce proven cyber insurance capabilities into maturing cyber insurance markets. Additionally, Envelop partners with cyber technology firms to launch embedded insurance solutions.
Envelop Risk plans to use the proceeds from the round to expand operations in cyber reinsurance and cyber technology partnerships, while continuing to invest heavily in predictive analytics for assessing the likely economic consequences of cyber risks to commercial entities.
As cyber has become a key trigger in nearly every business area, the firm said it intends to launch new products in adjacent areas of corporate risk over the next year. Critically, this raise will establish a hybrid balance sheet model, enabling the firm to deploy its own risk capital in alignment with existing partners, the company added.
“We are delighted to have reached such a significant milestone in our funding journey. This transaction will allow us to continue our leadership in data-driven specialty re/insurance underwriting and will be transformational for our business reach and activity,” commented Envelop Risk co-founder and CEO, Jonathan Spry.
“For the first time Envelop Risk will be able to assume positions in risk capital, which gives us greater alignment with our partners. We are all really excited to work with SoftBank Investment Advisers and together meet the huge opportunities that we see present in emerging and complex risk underwriting,” he added.
“Digital systems have reshaped our world, but they are also vulnerable individually, and as integrated networks. Cyber insurance plays a critical protective role,” said Paul Guthrie, co-founder and COO of Envelop. “Envelop deploys capital thoughtfully into the cyber insurance ecosystem, providing assurance that mitigation resources are available immediately upon an attack, so organizations can continue to function in the face of these risks.”
“We believe Envelop Risk has developed a proprietary data-driven approach to meet this threat through an enhanced level of protection that directly translates to lower loss ratios,” said Karol Niewiadomski, senior investor for SoftBank Investment Advisers. “We’re pleased to partner with Envelop Risk in its journey to enable risk capital and provide much needed capacity to the nascent cyber risk market.”
Envelop Risk is a global specialty cyber and emerging risk underwriting firm, headquartered in Bristol, UK, with offices in London, Bermuda and San Francisco. Envelop Risk’s proprietary model addresses the complexity of cyber and other emerging risk by combining artificial intelligence; security analytics; economic, financial and behavioral analysis, and modeling and simulation.
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