Insurance Technology has become one of the hottest sectors in recent years, with a plethora of companies entering the space. How does its overall exit activity trend over time? On our insurtech research platform, we have analyzed the data through 2017 and can conclude that insurtech exit activity continues to be on a healthy upward trend.
This observation was derived from two takeaways:
- Insurtech exit events are on a general upward trend at the annual level
- Insurtech exit events are showing overall growth at the quarterly level
We’ll illustrate these takeaways with two graphics that show insurtech exit activity trends over time.
Insurtech Exit Events On General Upward Trend Annually
We’ll start off by examining the insurtech exit events from 2011 to 2017. Exit events include both acquisitions and IPOs. The below graph highlights the number of insurtech exit events by year stacked by quarters.
This graph illustrates that insurtech exit activity is on a robust upward trend at the annual level. Specifically, the CAGR in exit activity from 2012 to 2017 is 46%.
Let's now see if the exit activity’s growth trend holds at a quarterly level as well.
Insurtech Exit Events Showing Overall Quarterly Growth
Below is a graph of the number of insurtech exit events by quarter.
The above graph shows that insurtech exit activity is demonstrating overall growth at the quarterly level, with some outlier spikes and dips which are to be expected. The number of exit events in Q1 2017 was 120% of those in Q1 2016. Q2 2017 numbers were 167% higher than the year before. However, Q3 and Q4 of 2017 saw a decline compared to 2016 figures.
Conclusion: Insurtech Exit Activity Is Seeing Overall Growth
In summary, we can conclude from these takeaways that insurtech companies are getting acquired and going public at an increasing pace over time. It’ll be interesting to see if this trend continues into 2018.