Ann: Strategic Investment in KOBA Insurance, page-12

it’s not that odd an investment. Koba is more of a platform than an online insurance offer. The tech of Koba, not just the device, has a lot more to offer than just quotes on Compare the Market etc. Both ENA and Koba stand to benefit from the way in which Koba can integrate into the offer that ENA has.

This deal hasn’t just happened over night and it obviously stacked up enough on the side of ENA that they tipped in $1.5m. I’ve been a backer of Koba pretty much from the start (I invested at their first pitch night) and when this deal started to get floated around it made a lot of sense, at least to me, and clearly the way it was presented in its final form to both Koba and ENA made a lot of sense.

I guess in its most simple terms,
-ENA gets an improved offer for their clients to save money on car insurance.
-Koba reduces customer acquisition costs
-Koba makes more money
-ENA gains from an appreciation in Koba’s value
-ENA gains a better understanding of their clients risk therefore allowing them to better improve their balance sheet
-ENA now has a tech platform for growth outside of their normal channels
-Koba can accelerate growth as it has secured more cash than it needed PLUS an aligned major shareholder who benefits from the same wins that Koba is searching for.

the way the 2 businesses can benefit from commercial alignment is of great benefit to their respective shareholders. For my money, I think that the right people are moving in the right direction for a great outcome. Insurance is a pretty low tech sector that is conservative on a glacial scale of speed in adoption of new ideas. For a small player it makes more sense to adopt good tech early on and grow with a far more clear understanding of the risk of the insured parties that make up their clientele. The ability to mitigate risk (which effectively is all insurance actually is) has been improved significantly for ENA by its stake in Koba, so no.. it’s not just an online motor insurance company that they have invested into.