Israeli maritime risk management startup Windward has announced the closing of a $16.5 million Series C financing round. The company plans to use the investment to hire dozens of development employees in Tel Aviv and to expand its offices in London. The round was led by US insure-tech fund XL Innovate, which has already invested in Israeli digital insurance company Lemonade, among others. Windward's existing investors also took part in the round, including Chinese billionaire Li Ka-shing's Horizon Ventures fund and the Aleph Fund, as well as private investors such as Salesforce founder, chairperson, and CEO Marc Benioff. As part of the investment, XL Innovate managing partner Tom Hutton will join Windward's board of directors. Windward has raised $38.9 million to date.
Windward develops risk management technology for marine cargo insurance. The technology is based on a cyber intelligence system developed by the company and used by law enforcement authorities, defense agencies, and governments facing threats to their national interests. One user of the system is the UN Security Council, which uses it to monitor and enforce sanctions against North Korea. Windward's investors also include former US CIA director David Petraeus, Start-Up Nation author Dan Senor, and former Thomson Reuters CEO Tom Glocer. Former British Petroleum CEO Lord John Browne recently joined the company board and former IDF Chief of Staff Gabi Ashkenazi is one of its advisors.
Founded in 2011 by CEO Ami Daniel and VP product Matan Peled, Windward currently has 60 employees in Tel Aviv and London. Daniel told "Globes," "This year is the company's best year. We have grown over 50% since the beginning of the year and we're on the way to doubling our sales by the end of 2018. We plan to double them again next year." He said that the capital raised would be used to double the company's development staff in order to meet the large demand. Daniel added that Windward planned to enter additional spheres in maritime insurance, as well as innovative insurance: insurance for natural gas platforms. He said that the company's second task was to get close to the market, and it was therefore about to substantially expand its sales branch in London.
Windward's risk management system analyzes 1,500 different variables of marine cargo transportation and enables insurance companies to determine the projected risk of vessels, in contrast to the traditional approach that sets the risk according to past experience. The system enables the insurer to select marine cargo activity suitable to his portfolio of companies and price the insurance more precisely.
Daniel says that the global trend towards shipping by air is not detracting from demand for the Israeli system. "It's a market of $30 billion in marine premiums, seven and a half times as large as the global cyber insurance market. The volume of cargo shipping is rising by 2-3% a year because ships are becoming larger." He comments that the global marine insurance market has recently undergone an upheaval with company striving to improve their profits. "For us, this is an opportunity; the question is the rate at which marine insurers will adopt the technology."
Windward is aiming to expand its activity in cargo transportation beyond risk insurance. Daniel says that a demand for the company's technology has emerged in the loss prevention segment: "We bring the know-how and understanding from the world of shipping and anchor it in data science, so that the insurance companies can use the information to advise the insured company exactly what risk it can handle. We're focusing on the market in which there is a real change, a real need, and our technology is already proven and working with existing customers."
Hutton said, "There is a huge opportunity in the marine insurance market. Windward has made itself the leader in the industry after acquiring the trust of many governments and law enforcement authorities around the world. Now they are expanding impressively in the insurance market. We expect to support Windward later through both investment and with our time and resources."
Published by Globes [online], Israel business news - www.globes-online.com - on July 1, 2018
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