Alternative reinsurance and investment platform Vesttoo has raised $6 million in a Series A funding round led by Hanaco Ventures, a New York and Tel Aviv-based venture capital fund that invests in emerging and late-stage start-ups from the global tech ecosystem.
The round is part of Hanaco’s broader investment strategy in Vesttoo, aimed at further developing Vesttoo’s Insurance-Linked Program (ILP) offering.
Vesttoo’s ILP offering is a security-based investment portfolio based on non-catastrophe insurance risks, which provides asset managers with the opportunity to earn additional alpha from existing assets without the need to allocate cash.
The ILP program offers institutional investors risk remote investments in collateralised reinsurance deals, earning BB spread of AA uncorrelated risk in addition to the yield of their existing, high quality assets, with a significant global deal pipeline targeting first closing of $1 billion USD assets under management within 12 months.
Furthermore, Vesttoo’s marketplace will allow insurers, reinsurers and pension funds to model, structure, price and place their offering online, while giving institutional investors direct access to the untapped market of alternative reinsurance and exceptional return on risk.
Both the ILP and the marketplace are novel instruments in the insurance space aimed at increasing liquidity and much needed capacity in the reinsurance market and facilitating the alternative reinsurance ecosystem, an integral part of Vesttoo’s business strategy to bridge the funding gap in the reinsurance market.
Yaniv Bertele, CEO of Vesttoo, says: “We have a significant global deal pipeline with insurers from the US, UK and mainland Europe, and are looking forward to further scaling Vesttoo’s ILP and fully digital marketplace with Hanaco’s support.”
Pasha Romanovski, co-founding partner of Hanaco Ventures, comments: “Vesttoo is disrupting the reinsurance industry. The company is building a digital marketplace and has already proven its ability to sign multi-year contracts with leading US and EU insurance and reinsurance providers.”
“Hanaco Ventures chose to invest in Vesttoo because of the unique solution and the company's impressive founding team who will have a big impact in this untapped sector.”
