When Eos Venture Partners invested in a cyber recovery firm, it had yet to generate significant profit.
Executive Summary
"How do we make the insurance industry better than we found it?"That's the mission of Eos Venture Partners, according to Jonathan Kalman, a founding partner of the venture capital firm, who told Guest Editor Mike Fitzgerald about some of the portfolio companies that reflect the mission, and about a strategy of turning loss-making companies into profit-making ones by providing capital, relationships and know-how.
Kalman also shared views on the impacts of AI and advanced analytics on P/C insurance and how carriers can prepare their workforces for an AI future.
See related articles, "Critical Thinkers Needed for AI-Powered Insurers" and "All Aboard What's Next for Executives and Boards of AI-Powered Insurers"
Michael (Fitz) Fitzgerald, Insurance Industry Advisor for SAS Institute Inc., served as guest editor for this article and others featured in CM's Q1-2024 magazine, "Leading the AI-Powered Insurer."
But Fenix24 has since had a “meteoric rise,” according to Jonathan Kalman, a founding partner of the venture capital firm that is exclusively focused on the insurance industry. Kalman, who would go on to explain that the essence of venture capital is investing in loss-making businesses, said his firm’s relationships with insurance carriers helped put Fenix24 on their radar.
Specifically, it was relationships with cyber insurers, “who said that their payouts were moving from being just ransom to business interruption.” Eos sought out ways to reduce the financial impact that business interruption claims were having on the insurers. Then Eos discovered Fenix24, a business that is built around what happens after a business experiences a cyber attack.
“After a breach, the next instance is chaos. When you log on, you can’t access your email. That can rip through an organization and impact its ability to function,” Kalman said. “This company comes in to remove the bad actor software hidden all throughout their systems. They get rid of it and get the systems restored.”
Months after the venture capital firm put $5 million into Fenix24 last year, “Fenix24 restored a high-profile casino breach,” Kalman reported, referring to work to restore the systems of a Las Vegas-based resort after a breach in September. “Fifty thousand people were locked out of their hotel rooms. They were losing millions a day, and they estimated it was going to take them eight weeks to be restored to functioning, Kalman said. “That’s independent of someone’s going to pay a ransom.”
