Key Takeaways:
Yuanbao has filed for an IPO in New York, reportedly seeking to raise a relatively modest $50 million in a deal that could value it at more than $400 million
Despite a difficult Chinese insurance market, the company’s platform that uses big data to match potential buyers with the most suitable products is booming
By Warren Yang
Insurance is often a tough sell, even in the best of times. So, life would be much easier for insurers if potential customers came to them first to shop, rather than the usual way where salesmen solicit new buyers.
That’s the nice scenario that Yuanbao Inc. – which calls itself an insurance distributor that offers “the seamless integration of insurance with cutting-edge technologies” – is striving to sell to customers through its online marketing platform. It appears to be succeeding at that mission, at least based on its booming business, which could help it convince investors to give it a look as it seeks to go public.
Last week, Yuanbao, a young company founded just five years ago, filed for an IPO in the U.S., with big guns Goldman Sachs, Citigroup and CICC as the lead underwriters, according to a prospectus filed with the Securities and Exchange Commission. Such big-name underwriters would usually imply a relatively large offering, though one media report indicated the target is a relatively modest $50 million.
Essentially, Yuanbao is an insurance broker that offers highly targeted online services for insurers through its “engine” using big data. To help its insurance partners find new buyers, it deploys computer models to popular sites like social media to gather data on consumer traits and behavior. Its engine then generates initial predictions on potential buyers’ demands and, based on them, produces tailored advertising content for each individual.
When potential buyers come to Yuanbao’s platform, it collects and analyzes more data about them and matches them with the most suitable products. The company also provides post-sales services. It generates revenue both by collecting payments for its services from insurers, and also from collecting commissions …
Full story available on Benzinga.com