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byMiles Acquired: The Story Of A Neo Car InsurTech In The UK

A few days ago the UK insurer Direct Line Group announced the acquisition of the car InsurTech startup byMiles.

If the amount of that deal was not disclosed, it was a fairly expected movement in the ecosystem (the M&A deal I mean, not specifically that startup). And it is an opportunity for us to take some lessons, as we did with Simplesurance acquired by AllianzX a few months ago (read here).

Let's retrace the history of byMiles!


(🇫🇷 Cet article est aussi disponible en Français - en version audio - dans le dernier épisode de mon podcast >> à écouter ici)



For those of you who are not familiar with this InsurTech startup, byMiles was created in 2017 within the startup studio / incubator Insurtech Gateway in the UK. From its start, it positioned itself as an online car insurance distributor. The idea has been in particular to target drivers who drive little - below 7,000 miles per year to use the figure often pushed by the startup itself.

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The equity story

Very quickly, it raised a first round of funding, £1m, almost simultaneously with its commercial launch in July 2018. This round was made with JamJar - the fund created by the founder of the Innocent brand drinks. It should be noted that alongside InsurTech Gateway, another historical support of the startup is renewing its interest in the project. This is InMotion, the investment branch of the Jaguar Land Rover group, which will have accompanied the startup throughout its development.

A little less than a year later, in March 2019, the startup announced a new funding round: £5m in Series A. This saw the entry of a generalist VC, however accustomed to supporting startups in the insurTech. This is Octopus Ventures, British fund. It is then specified that the historical actors all return to the pot.

Finally, a year later - in May 2020 - upon emerging from confinement, the startup announced a third round of financing: £15m in Series B with the investor Commerz Ventures as a lead. He is well known for investing for a long time in FinTech and InsurTech in Europe. Note also that earlier, he took a stake in another B2C InsurTech startup ManyPets (which was still called BoughtByMany at that time).

The current status of the company

You will have done the math, it has been three years since the startup raised its latest funding round, and given the current mistrust of investors for B2C models in InsurTech as in FinTech - and startups more broadly - it is not impossible to think that the startup sought refinancing last year, about 18-24 months after its last round. Unless it has reached profitability in the meantime, which is also an option.

In any case, its workforce had grown continuously during its development, reaching 79 employees in April 2022. To date - and still based on figures available on LinkedIn - 65 people work for the startup. This is an 18% reduction in the workforce from peak team.

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We are not very far from the benchmark we see on the market, about 20% reduction in most startups. That move was largely initiated in the US last year, and which took a little longer to arrive in Europe it should be noted. There are always two ways to read these downsizing: either the startup seeks to save time whatever its roadmap (fundraising or M&A), or it seeks to achieve - or at least approach - the profitability.

The M&A deal

We therefore had the answer recently, it is a takeover, from an historical player. This is not a surprise since a wave of M&A deals was widely expected in InsurTech as in the startup industry more broadly. Both because investment is at half mast, but also for technical reasons: some startups have been on the market for around ten years and the VCs on board must necessarily think about the liquidity of their investments.

In short, the deal is done. With an historic player in the UK P&C insurance market. With more than 1.5 billion pounds in premiums in motor insurance, it is a juggernaut that has just made this acquisition. It should also be noted that Direct Lined Group is historically a player in the direct insurance market, as its name suggests, and a precursor of innovation around car insurance, since he invested in a Telematics startup in 2014, The Floow was his name. This partnership was reinforced recently - in 2021 - when the companies announced in May 2021 to launch a Telematics offer using only the data generated by smartphones, eliminating the dependence on the dongle usually used in this type of offer, with all the friction it creates.

Biz Dev

Back to byMiles. We have retraced his fundraising journey, but what about the sales, you wonder. On this aspect the startup has always been rather discreet and has never communicated a lot of figures. This is why the analysis of its team size - in addition to its fundraising - is a way of approximating its commercial development. It is obviously not an exact science, but it gives an order of magnitude, and makes it possible to compare with other players.

Only in March 2019, alongside its series A round, the startup indicated that it had covered more than 1 million miles that its customers had traveled in 9 months, since its launch.

In December 2019, the startup communicated on its product, announcing the launch of an insurance offer dedicated to Tesla connected cars.

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Fortunately, the takeover press release tells us more about sales, and two figures were shared:

On one hand, it is mentioned 100,000 policies sold since the launch of the startup. On the other hand, a total of 50,000 customers is indicated.

Taking into account multi-equipment, which is not inconceivable, this gives a glimpse of the churn at an InsurTech B2C (remember that, according to the startups, the communication is sometimes done in number of customers, sometimes in number of policies sold, often since creation, disregarding the churn, which remains a publicly guarded figure).


Overall the startup generates £26m in GWP. This is obviously very low compared to the large group (1.6% exactly, I did the math for you) but it is a significant figure for a company launched a little over 5 years ago!

It should be noted, however, that this GWP figure, £26m, is barely higher than the total amount of funds raised by the startup, £21m.

And I like to do this calculation: premiums issued divided by the amounts raised, because it gives an idea of the capital efficiency of an Insurtech (or neo-insurer) while these players distributing online insurance had in my opinion two objectives: on the one hand to digitize the customer experience - this is done either via a website or through a mobile application, sometimes both - and on the other hand to reduce acquisition costs. This is what the market must continue to verify.

On that basis the takeover can either be a technological acquisition (or product to be more precise I think) the corporate buying a digital player offering a last generation customer experience. It can also be the buy out of a portfolio, even if in this case the size of the portfolio redeemed seems very limited compared to the corporate itself. However, the notion of acquisition cost still holds and according to the figures of the startup, its commercial efficiency could have been an additional argument leading to the takeover.

Finally, note two points:

On one hand, the startup was only an intermediary and did not have - to my knowledge - a full-stack insurer status. All of the funds raised were therefore able to contribute to the development of its product (in the technological sense of the term) and its commercial conquest. His income therefore corresponded to a fraction (the market practice is around 20%) a fraction therefore of the premiums generated.

On the other hand, and you noticed it: I did not talk about the selling price. Unfortunately, this has not been made public. However, this could be very useful to the ecosystem by providing a comparable for the European market, and for a latest generation player. Indeed, there are many orders of magnitude for traditional distributors (brokers around the corner to make it quick, we talked about it in the December 2022 podcast) but investors are still curious to know the figures on players closer to their portfolio startups.

What's next?

It remains to be seen whether this M&A deal triggers a wave of merger between startups and large groups, with a question mark that persists: what is the price of this kind of InsurTech? To be continued.


Note: read the full PR released by Direct Line Group.

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