American Family Buys Chicago Firm to Expand Analytics, A.I. Use
In recent years, American Family Insurance has spent significant amounts of money and time developing new technologies it believes could improve customers’ lives, as well as the Madison, WI, company’s bottom line.
These investments have been both internal—for example, ramping up the use of data analytics and artificial intelligence to assess risk and price policies—and external, through the American Family Ventures fund launched in 2010.
American Family’s latest investment in tech is its purchase of Chicago-based Networked Insights, which the companies announced Thursday. Networked Insights develops software that scours social media sites and compiles data customers can use to assess and tweak their marketing campaigns.
“We have significantly invested in our technology platforms and data and analytics in the past three years,” Jack Salzwedel, American Family’s CEO and chairman, said in a prepared statement. “This acquisition and others strengthen our best-in-class agency distribution by bringing best-in-class digital and data capabilities, providing our customers with both expertise and convenience.”
American Family said in a press release that it’s not disclosing the amount it paid for Networked Insights.
Networked Insights says on its website that its digital tools crawl 560 million posts on the social web from 30 million sources each day. The company says it classifies these tweets, comments, and status updates in more than 25,000 ways. The idea is that by helping marketers understand what people are saying online about their products—or ones sold by their competitors—Networked Insights can help its customers better understand and target their audiences.
Networked Insights’ clients include NBC Universal and American Family.
In addition to being a customer of the Chicago company, American Family has also invested in it, first in 2013 and then in subsequent funding rounds. Networked Insights is the latest startup in American Family Ventures’ portfolio to be acquired, and the first that’s been sold to the VC fund’s parent company.
Networked Insights said earlier this year that it had raised a total of $80 million in outside investment. That total included a $30 million Series E funding round the company announced in January. Its other backers have included Goldman Sachs (NYSE: GS) and two Wisconsin-based funds: 4490 Ventures and the Kegonsa Seed Fund.
Networked Insights founder and CEO Dan Neely launched the company in Madison in 2006. It later moved to Chicago, but maintained an office in Madison, as well as one in New York.
According to Thursday’s release, all 74 Networked Insights employees will keep their jobs following the acquisition. Neely will join the American Family senior executive team, the companies said.
It appears that American Family is not only interested in using Networked Insights’ technology to improve the insurer’s advertising campaigns, but also to collect and analyze data to help its core insurance business remain competitive in the industry.
“The analytics capabilities we gain with Networked Insights will strengthen our ability to provide proactive protection to customers and to quickly identify and meet customer needs in new ways,” said Peter Gunder, American Family’s chief business development officer, in a prepared statement.