Acturis has sold a minority stake in the company to ‘growth equity’ firm, Summit Partners, as it embarks on a European growth strategy.
A spokesman for the insurance software firm said the company had identified Europe as an area of strong potential growth as the broker market there was fragmented and it was felt there was an opportunity to bring something different.
“We are in a unique position in Europe as we offer software as a service – we are giving a complete service not just a product. The market in Europe for Broker IT is pretty fragmented and there can be as many as 70 IT companies in one country,” he said.
“But the European broker market has increased in size over the last four or five years. The cost model of a tied agent network is under review with a couple of insurers and we can operate in both spaces, whether it is helping the growing independent broker market or helping the tied agent market become more efficient. There is potentially a double play for us,” he added.
The spokesman said that the most obvious country to launch Acturis in continental Europe was Germany as, outside of the London Market, it was the largest insurance market in Europe and to do that, Acturis would have to have a physical presence in the country.
“If we are serious about this we need local people, local expertise and local servicing but in terms of infrastructure, we already have a hosting site in Amsterdam".
“We believe that Acturis has about 20% of the relevant market in the UK so there are still massive opportunities here. The electronic trading of commercial business in the UK in particular is a massive growth story and future opportunity. Our future development will be UK-led but we will take the lessons we have learned in the UK and transfer those to continental Europe,” he said.
He added that Acturis would initially be looking to work with a ‘significant partner’ in Europe. He would not be drawn on the identity of that partner but he said that the company would be developing existing relationships with both brokers and insurers and would be looking to target new clients.
This is not the first time that a UK-based insurance software system has expanded overseas but traditionally, this expansion has been limited to English-speaking countries.
Commenting on the deal, Theo Duchen, co-CEO of Acturis, said: “We are pleased to team up with Summit Partners, with whom we have had a close relationship for some time, to further leverage our success and continued growth strategy in the UK and in Europe.
“This transaction represents an important milestone in Acturis’ development as we continue to focus on delivering best-in-class technology and services to our customers. Summit Partners’ invaluable experience in pan-European financial technology and software investments will help us continue to grow and strengthen our business.”
Mr Duchen and fellow co-CEO David McDonald, will continue in their present roles and remain major shareholders in Acturis as will the rest of the management team.