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Industry first: Aegon backs start-up technology

Global, March 24, 2015

Aegon is the first in the insurance sector to leverage innovation through a dedicated investment fund. Transamerica Ventures has a budget of €100 million to fund start-ups developing new technologies for the financial sector.

Aegon has been active in setting up innovative companies for some time. Knab Bank, Kroodle and female-friendly insurance brand onna-onna have a relatively large degree of freedom to test innovations in the market. But Aegon is going one step further with its venture fund, looking for innovation outside the company, without wanting to take a majority stake.

Insights into future developments

"Involvement with these companies will enable Aegon to gain greater insights into future developments in the financial services industry. It makes our future tangible and provides guidance for Aegon's management," says Georg Schwegler, CEO of Transamerica Ventures.

The fund is looking for smaller companies that are active in fields such as data analysis, digital financial advisory services and security against cybercrime. Aegon hopes to use any new insights it gains in its transformation from intermediary company, to a company that maintains its own contacts with end-clients. Aegon's intentions are more than simply financial – it hopes to become a client of these companies, active on both sides of the ocean.

The next 'big' thing

This series of minority stakes in these companies will help Aegon respond more effectively to developments in a rapidly changing environment. "We are constantly on the lookout for the next big thing that will change the way the insurance industry does business," continues Georg Schwegler. "Early-stage companies who are brimming with relevant ideas and technology are key players."

So far, Aegon has acquired a stake in six companies located around the world, including the US and Germany, with an average invested sum of around €5 million per stake. The portfolio includes wealth-advisory software, cloud access security to protect customer data, and a platform for alternative consumer lending and predictive analytics.

Measuring success

Success will not be measured on the basis of the profit or loss of any possible future sale of its stake. "The main question is what it contributes to the transformation of our company," says Marc Van Weede, Aegon's Global Head of Strategy & Sustainability. "It is clear that we need a more direct relationship with our clients, but the exact route to achieving that will require experimentation."

Written by: Aegon