By Martin Coulter
LONDON (Reuters) -U.S. venture capital firm Andreessen Horowitz has backed London-based insurance startup Hyperexponential in a $73 million funding round, the insurance software company said on Thursday.
Founded in 2017, Hyperexponential provides insurance companies with mathematical modeling software, allowing them to price policies based on a wide range of data. The funding round was led by Battery Ventures.
The firm's funding announcement comes during a slump in investment in Europe's technology sector, which is expected to have plunged to $45 billion in 2023 from $82 billion in 2022, according to research from venture capital firm Atomico.
"There is still appetite for businesses that are doing very well, that are self-sustaining, and are growing. We are fortunate enough to fall into that group," Hyperexponential's cofounder and CEO Amrit Santhirasenan said.
Last week, U.S. investment firm Coatue confirmed plans to wind down its London office two years after it opened, with an internal memo stating the company aimed to streamline operations.
Asked about Hyperexponential's success amid a downturn in investor sentiment in Europe, Santhirasenan said: "In the past, companies have been dependent on external capital, grown as quickly as possible, raised more money, and then seen what happened. That era seems very far behind us."
Angela Strange, general partner at Andreessen Horowitz, said: "Insurance is one of the largest industries in the world, but many companies don't have a modern data stack. They're working with very old tools.
"Companies will pay a lot of money if you can solve their problems -- make them more efficient and improve their top lines."
The company will use the funds raised to double its headcount to around 200 employees, and drive expansion in the United States, where it plans to open a New York office later this year.