INSURTECH startup CXA Group has raised US$25 million in a bridge funding round for its expansion in the Asia-Pacific.
Key investors in this round are HSBC, Singtel Innov8, Telkom Indonesia MDI Ventures, Sumitomo Corporation Equity Asia, Muang Thai Fuchsia Ventures, Humanica, and Heritas Venture Fund, among others. These latest investors will become strategic partners, licensing CXA’s platform to serve their customers and/or employees.
Rosaline Chow Koo, founder and CEO of CXA Group, told BT that investors in the round were issued a convertible note to Series C. “But since we expect to break even next year, we may not need additional funding,” she said.
The latest round follows US$33 million in total funding from Series A and B in 2015 and 2017, respectively. Other investors in CXA include B Capital Group, Openspace Ventures, EDBI, BioVeda Capital, FengHe Asia, Philips and RGAx.
CXA runs a Software-as-a-Service (SaaS) health and wellness platform. Businesses use this platform to give their employees access to a range of health, wealth and wellness offerings, personalised based on the individual’s health and life-stage data.
Employees can purchase offerings by drawing down on existing insurance policies provided by their employers. The platform also offers an e-wallet to make transactions cashless and easy.
Through the aggregation, anonymisation and analysis of digitised health and life-stage data, employers can get to the root cause of their workforces’ health issues and design specific interventions to tackle them, reducing chronic disease and healthcare expenditure.
“For example, we helped a pharmaceutical company use health risk assessment, face-ageing and year-on-year data to identify hypertension, hyperlipidaemia and diabetes as major health risks for almost 15 per cent of its 1,500 employees and supply a chronic disease care management programme,” said Ms Koo.
The fresh funds will be used to invest in engineering and data science, talent and acquisitions. CXA has made three acquisitions so far to scale the business, involving several brokerages and a Chinese check-up aggregator.
It will also channel the money into working with partners, such as HSBC and Singtel, to carry out technology and platform integrations, which is key to its white-labelling strategy. A white-labelled product is made by one company then packaged and sold by other companies under varying brand names.
The group has more than 600 clients, including Fortune 500 companies. In 2019, it will turn to distributing its platform via strategic partners - banks, telcos and insurers - who will white-label and deploy its platform to both their employees and their enterprise customers. This will be the main driver of its revenue, which is projected to double from 2018 to 2019, said Ms Koo. CXA recorded a revenue growth of 65 per cent for 2018.
The company has offices in Singapore, Hong Kong, Shanghai, Beijing and Jakarta, and engineers in China, India and Singapore.
Edgar Hardless, CEO of Singtel Innov8, said: “CXA’s innovative use of analytics helps its enterprise clients effectively manage their healthcare costs and promote their employees’ well-being. We are excited to be an investor in CXA and help with their expansion across Asia.”
Eduardo Saverin, co-founder and partner of B Capital Group, the lead investor in CXA’s Series B round, said that the strategic investment from HSBC, Singtel Innov8 and others reinforces its belief in technology enablement and value creation from high-growth companies partnering larger organisations.
Mr Saverin, who was co-founder of Facebook, added: “With the collective support of banks, insurers, telcos and payroll companies as co-investors, CXA can now accelerate its expansion into new markets and bancassurance channels, while creating new revenue opportunities for these partners’ businesses.”