As consumers have shifted to the web to order and pay for services like broadband and insurance, price comparison sites have become one of the main ways that they search for the best deals to cover what they need. Today, one of the bigger companies in the space in Europe, CompareEuropeGroup, announced that it has raised €20 million ($21 million) to expand and move ahead of the pack.
The investment — a Series A — is notable both for its size (large for a European startup) and because of who is providing the money.
The investment is led by ACE & Company (which has backed the likes of Pinterest, Transferwise, Uber and Space X), and also includes Richard Li’s Pacific Century Group, Nova Founders Capital, SBI Holdings (former Softbank Investments), Mark Pincus (founder of Zynga), Peter Thiel (the Paypal and Palantir founder and star investor) and others.
Some of CompareEurope’s investors had already been backers of its sister companies covering other verticals and regions, such as CompareAsiaGroup, although the companies are run as separate entities, according to Thomas Munk, who co-founded CompareEurope with Antonio Gagliardi and Mads Faurholt-Jorgensen.
The premise behind CompareEurope, which was founded in 2015, is a simple one: the company uses machine learning and other algorithms to sort through and search for the best deals for a particular service in real-time, based on a few parameters entered by the consumer.
As a user, you will typically get dozens of suggestions from a range of providers, with a sliding scale of prices covering different things. (For example, one car insurance offer may have a higher deductable, another might include coverage outside of your home country.)
As new deals are found — an insurance company, for example, will be creating different products all the time to fit different profiles — those are suggested to users if they’ve opted in to receive them. CompareEurope gets a cut when you actually purchase one of these services through its site.
All in all, it’s a very efficient way of aggregating and comparing a range of offers for a service you might need to buy, which also poses a challenge for CompareEurope: there are literally dozens of platforms that offer the same or a similar service like it across Europe and the UK, including GoCompare, MoneySupermarket, CompareTheMarket, uSwitch and many more.
Munk said he believes that CompareEurope is distinctive, and better. “I would argue that CEG is not, simply, a comparison platform,” he said. “In fact, we help user get a tailored result based on their profile and needs, as well as help them actually buy the product and manage it over time. Hence, the difference is in the approach to the customer needs, and the related data-driven technology that sits behind it. Also, we have a focused strategy of targeting markets with limited financial comparison services, thus making a big difference in these markets.”
Indeed, the company is currently in five markets in Europe but does not have a service in the very competitive UK market, and has no plans to, Munk said.
Munk would not disclose the valuation of his company, or any financial metrics, except to note that the company is “experiencing significant growth in all its markets.”
To that end, the funding will be used mainly to “launch new verticals in all the countries, continue to develop our proprietary technology and algorithms, and invest in marketing to further raise awareness and reach more users,” he said.
It’s a formula that for now has caught the eyes of investors enough to see if CompareEurope can scale and take the spoils.
“Both consumers and partners have welcomed CompareEuropeGroup with open arms,” said Marc Syz, Managing Director at ACE & Company, in a statement. “The insurance, banking and telco markets are a unique opportunity with plenty of room for technological progress. We are excited to be part of this ambitious journey.”