Bestow Raises $120M Series D Funding

Bestow's Strategic Shift and New Funding

Melbourne O’Banion, alongside Jonathan Abelmann, established the insurtech company Bestow in 2017. This followed O’Banion’s personal difficulty in obtaining life insurance coverage.

The initial aim was to streamline the life insurance acquisition process and integrate more technology into it.

Early Operations and Growth

Bestow initially functioned as a direct-to-consumer provider, handling the entire lifecycle of life insurance policies – from sales to underwriting and customer service. Over its first several years, the company processed more than one million applications.

The company’s platform, which offered underwriting without requiring medical examinations, saw increased adoption during the COVID-19 pandemic when traditional medical exams were frequently postponed. Simultaneously, Bestow developed software designed to modernize the broader insurance process.

Transition to a Software-Focused Model

In 2024, Bestow recognized the substantial value of its software and subsequently sold its insurance carrier and direct consumer business to Sammons Financial Group for an undisclosed sum.

The company then redirected its efforts towards providing its software and services to other life insurance companies, enabling them to enhance their digital capabilities and improve customer service efficiency.

Series D Funding Announcement

On Tuesday, Bestow announced a $120 million Series D funding round, intended to support the launch of new products and underwriting features. This information was shared exclusively with TechCrunch.

The funding round was notably “oversubscribed,” comprising $75 million in primary investment and $45 million in secondary investments.

Investment Details and Valuation

Goldman Sachs Alternatives’ Growth Equity and Smith Point Capital, led by ex-Salesforce co-CEO Keith Block, jointly spearheaded the investment.

In addition to the equity financing, Bestow secured a $50 million credit facility from TriplePoint Capital. O’Banion refrained from disclosing Bestow’s current valuation, stating only that it had “approximately doubled” since the $70 million Series C round completed in December 2020.

To date, Bestow has raised over $300 million in equity funding.

Revenue Growth and Business Model

O’Banion also chose not to reveal specific revenue figures, but indicated that Bestow’s annual recurring revenue tripled in 2024 and experienced a “10x” increase over the past two years.

The company’s revenue model is based on enterprise SaaS (software-as-a-service) and performance-based fees, with the majority of revenue derived from usage charges.

Rationale for Investment

Ashwin Gupta, a partner at Goldman Sachs Alternatives’ Growth Equity, explained that several factors attracted his firm to Bestow. He highlighted the founders’ experience as repeat entrepreneurs who had “successfully pivoted the business.” (O’Banion also co-founded BeautyBio and is a founding member of Presidio Title, while Abelmann co-founded publicly traded Invitation Homes.)

Gupta also believes Bestow’s SaaS model provides a competitive advantage over more established companies.

Market Opportunity and Customer Traction

“Bestow operates in a large, stable, and relatively untapped market for modern technology…,” Gupta stated. He also noted, as a new board member, his impression of Bestow’s success in securing and expanding relationships with significant clients.

Key Customers and Backers

Bestow’s customer base includes prominent names such as Nationwide, Transamerica, USAA, Sammons Financial Group, and Equitable.

Additional investors include Breyer Capital, Valar Ventures, New Enterprise Associates, Core Innovation Ventures, Morpheus Ventures, and Sammons Financial.