South African digital insurance distributor Hepstar raises $2M from UK-based Amadeus Capital

Digital insurance distributor Hepstar has received $2 million in funding from UK-based technology investor, Amadeus Capital Partners. With the new funding, Hepstar plans to expand global reach, accelerate technology development and grow its brand.
Hepstar was founded in 2013 to address the need for e-commerce companies, in general, and airline and travel companies, in particular, to maximize ancillary revenue. Ancillary revenue refers to revenue from non-primary sources. For example, in the case of the airline industry, ancillary revenue is revenue from non-ticket sources, such as baggage fees and on-board food. Commission-based revenue from sales of services such as hotel accommodation, car rental and travel insurance also constitute ancillary revenue.
“The global airline ancillary opportunity is around $60 billion. We can help our partners make up to 30% of their net revenues from insurance ancillaries,” said Hepstar CFO Brett Dyason.
Over the last year, Hepstar has grown its presence to include Africa, the Middle East, Europe and Australia. Clients include CarTrawler, South African Airways, ClickBus, International Air Travel Index (IATI), Flightsite and Travelstart. Hepstar achieved this rapid growth by leveraging strategic partnerships with some of the world’s leading Global Distribution Systems (GDSs), as well as insurance companies, such as Mapfre, Regent, Al Sagr and Orient Sigorta.
“We’re extremely pleased [with] our partnership with Amadeus Capital Partners. They understand our business and vision,” said Dyason. “Hepstar has grown organically to date and we are now anticipating growth of 150% in 2016. This investment will allow us to focus on innovation, sales and local talent acquisition.”
“Amadeus Capital is excited to be involved in Hepstar,” said Andrea Traversone, Investment Partner at Amadeus Capital Partners. “They are solving a real problem regarding insurance distribution during a time when ancillary revenue is becoming increasingly important for e-commerce companies. Given the prowess they have demonstrated in this niche, we expect they will be a leading supplier in this market in the near future.”
Amadeus Capital Partners invested in Hepstar through Amadeus’ Digital Prosperity Fund, which is backed by the MTN Group. The fund assists growth companies in developing online and mobile applications in emerging markets in Africa, the Middle East, Asia and Latin America.