Beam Benefits has raised $40 million at an increased valuation – contrary to national VC trends – to speed growth and product development for its suite of digitally-powered employee benefits for small and medium businesses.
The Series F increases Beam's valuation by 25% – although the total was not disclosed – since an $80 million round two and a half years ago, according to a news release. The Columbus insuretech has raised a cumulative $200 million over 12 years.
Beam, which recently started offering disability insurance underwritten by The Hartford, is on track to increase revenue by 40% year-over-year, the release said. The company, which rebranded from Beam Dental in 2022 to reflect broader offerings, launched six benefits products in 18 months.
“Our most recent funding is an incredible accomplishment, especially in the face of today’s economic headwinds, and marks a significant step forward in our company’s aggressive growth plans,” co-founder and CEO Alex Frommeyer said in the release.
Toronto-based Georgian Partners led the round, the release said, with broad participation from new and existing investors and strategic partners. Georgian also led a 2019 round and participated in the 2021 funding.
A Form D investment notice filed on Tuesday, a week after the company posted its release online, listed the total as $40.9 million, indicating the round could have grown. The filing with the U.S. Securities and Exchange Commission indicated 13 investors.
Company representatives were not immediately available for further comment.
Nationally, venture capital deals have stagnated or declined at all startup growth stages, according to PitchBook. The industry analytics platform recently reported that so-called "down rounds," investing at a lower valuation than the previous round, are at their highest point in five years.
Frommeyer is among Central Ohio's most admired leaders of large employers in this year's Columbus Business First C-Suite Awards. The company also made this year's Inc. 5000 for its revenue growth from 2019 to 2022.
Columbus-based Drive Capital LLC was the first investor in Beam and moved the early-stage company to Columbus from Louisville.
In February Beam cut 31 jobs, or 8% of its workforce, amid a nationwide wave of tech layoffs.
Based in 80 on the Commons downtown, Beam cited "tens of thousands" of employers as customers, with hundreds of thousands of covered employees and dependents. It started with dental insurance but has added vision, life, disability, and other benefits other than medical.
For dental customers it also offers a smart toothbrush that connects to an app to evaluate and provide reminders on brushing habits, along with custom toothpaste delivered to the home.
Beam's software creates a digital-first interface to quickly generate quotes and cut paperwork, and its machine-learning pricing models have kept claims losses consistent, Frommeyer has said.
The DBA of Beam Technologies Inc., Beam Benefits does not assume the coverage risk directly: It is a third-party administrator for plans with outside underwriters. Besides Hartford, those include Columbus-based Nationwide, National Guardian Life Insurance Co. and VSP.
Nationwide's VC arm also is an investor in Beam.
