Melbourne O’Banion co-founded insurtech Bestow with Jonathan Abelmann in 2017 after struggling to safe his personal life insurance coverage coverage.
His objective was to make it simpler for folks to acquire life insurance coverage and make the method extra tech-enabled.
Initially, Bestow operated as a direct-to-consumer insurance coverage supplier — promoting, underwriting, and servicing life insurance coverage insurance policies. In these first few years, the startup processed over one million purposes. Its no-exam underwriting platform gained traction throughout the COVID pandemic as conventional medical exams had been paused. Because it grew its D2C enterprise, Bestow in parallel developed software program to assist modernize the entire course of.
Recognizing the worth in that software program, Bestow in 2024 offered its insurance coverage service and shopper enterprise to Sammons Monetary Group for an undisclosed quantity. It switched its focus to offering its software program and companies to different life insurance coverage firms so these firms might “develop into extra digital” and thus, extra effectively serve their prospects.
And on Tuesday, the Dallas-based firm is asserting that it has raised $120 million in Collection D funding to launch new merchandise and underwriting capabilities, it has informed TechCrunch solely. The fundraise, which O’Banion described as “oversubscribed,” was a mixture of $75 million in main and $45 million in secondary investments.
Goldman Sachs Alternate options’ Progress Fairness and ex-Salesforce co-CEO Keith Block’s Smith Level Capital co-led the funding. Along with the fairness financing, Bestow additionally secured a $50 million credit score facility from TriplePoint Capital. O’Banion declined to disclose Bestow’s valuation, noting solely that it had “roughly doubled” for the reason that firm raised $70 million in a Collection C spherical in December 2020. With this newest financing, Bestow has raised greater than $300 million in fairness funding to this point.
O’Banion additionally declined to disclose arduous income figures, saying that Bestow’s annual recurring income grew 3x in 2024, and “10x” during the last two years. Its income mannequin is enterprise SaaS (software-as-a-service) and performance-based. The majority of its income comes from utilization charges.
Ashwin Gupta, a Goldman Sachs Alternate options’ Progress Fairness workforce associate, informed TechCrunch that he was drawn to backing Bestow for a number of causes. For one, its founders had been repeat founders who had “efficiently pivoted the enterprise.” (Melbourne additionally co-founded BeautyBio and is a founding member of Presidio Title. Abelmann co-founded publicly traded Invitation Houses.)
Gupta additionally thinks its SaaS mannequin provides it an edge over extra legacy opponents.
“Bestow has a lovely finish market that’s massive, resilient and comparatively underserved by fashionable expertise…,” he stated. Gupta, who’s becoming a member of Bestow’s board as a part of the financing, additionally famous that he was impressed by Bestow’s means to have gained a number of massive prospects who had been increasing their use of its platform.
Its prospects embody Nationwide, Transamerica, USAA, Sammons Monetary Group, and Equitable, amongst others.
Different backers embody Breyer Capital, Valar Ventures, New Enterprise Associates, Core Innovation Ventures, Morpheus Ventures, and Sammons Monetary.
Bestow, which has 167 workers, at present operates within the U.S. and is contemplating a global enlargement.
