Cyber attacks are not one-off events but occur often. With this way of looking at cyber risk, Cyberhedge has built a technology that measures the costs of cybersecurity and therefore hedges the risks. Photo: Shutterstock

Cyber attacks are not one-off events but occur often. With this way of looking at cyber risk, Cyberhedge has built a technology that measures the costs of cybersecurity and therefore hedges the risks. Photo: Shutterstock

Cyberhedge, a cybersecurity company hosted at Lhoft and financed by the Luxembourg Future Fund (LFF), has raised €4m since the beginning of the year. It also launched its first product in London on 16 March under its new name, Intangic.

London-based Intangic MGA last week announced the launch of its first cyber security product, ‘CyFi.’ It will give UK listed companies, for the time being, the most accurate picture yet of the effectiveness and return on investment of spending on cybersecurity in relation to the types of cyber attacks and the overall risk profile of the business. They will pay an insurance premium based on their rating, ranging from five stars for the best to one star for the least cybersecurity advanced, through a partnership in London with AXA XL.

“It’s just about thinking differently about the problem,” said Intangic MGA CEO Ryan Dodd in the press release issued on 16 March. “Security teams in large enterprises have to deal with cyber threats all day, every day. Our approach assesses the cyber threat as a high frequency risk. By accepting cyber attacks as ‘constant,’ we can measure a link between how these attacks are managed and the financial impact they have on business operations. Our parametric triggers make this link visible, enabling rapid recovery from covered physical breaches and offering companies a new type of insurance risk transfer. In doing so, we have converted cyber risk into a language that the board understands.”

Up to 70 tools of questionable effectiveness

According to the CEO, in a note for Mandiant’s cybersecurity firm, companies are only using their defence and analytics technologies to 25% of their capacity and they have 30 to 70 different security tools, sometimes costing them millions of dollars to deal with a single type of attack.

The American announced that he has gathered around him Mark Heath (head of insurance and director of underwriting, ex-broker at AIG and Aon), Debbie Durkan (ex-chief client officer at Marsh Commercial and ex-global head of development at Bowring Marsh), Dana Deasy (former CIO for the US Department of Defense, former CIO and Managing Director at JP Morgan Chase, former CIO at BP) and Chris Key (former product manager at Mandiant and founder and CEO of Verodin until its acquisition by FireEye/Mandiant).

€1.6m from the LFF

Intangic, which arrived in Luxembourg in 2018, is the new name of one of the companies spotted by the Luxembourg Future Fund. For now, Intangic MGA is not a joint venture of Intangic and Acies Management as the press release says, but only of the latter, which it joined last July. It is only a matter of time but the US Patent and Trademark Office only granted Cyberhedge Europe the Intangic trademark in early March.

On Tuesday afternoon, 21 March, a communications expert hired by the company explained that “Intangic and Acius Holdings have combined resources such as investment and finance skills and experience, with data science and insurance and underwriting expertise, to create a unique team. This alignment, joint board seats and close collaboration has resulted in the creation of this new insurance product. The commercial arrangement between the two companies is of course confidential.”

Since the beginning of the year, the startup has raised a further €4m, including €772,000 from LFF, which had already participated in 2019 in another capital increase by contributing €846,906. That is more than €1.6m in total. In 2021, the fintech which develops its products in the office next to that of the CEO of Lhoft, , had closed on a cumulative loss of €5.2m, higher than its share capital, hence its urgent need for recapitalisation.

Target: £10m in one year

The LFF’s participation--which should be called LLF1 since the minister of economy, (LSAP) and the minister of finance, (DP), announced on 17 March the of €200m, again with the EIB--is aimed at creating financial value and developing the business. Cyberhedge currently employs four full-time staff members and one who works part-time.

This first contract with AXA XL for its technology could signal the start of its business. According to an interview with a UK online media outlet, Dodd imagines that up to £12.5m will be available to businesses to cover losses from cyber property breaches. “We think we can get to £10m in gross written premiums in 12 months in the UK,” said the American entrepreneur.

This story was first published in French on . It has been translated and edited for Delano.

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