French unicorn Alan, which provides health insurance for businesses and their employees, hit €350m in revenue in 2023 — a year-on-year growth of nearly 40%, falling just short of the company’s target.
The Paris-based scaleup, which is valued at $3bn, had forecasted 50% growth for 2023, a target of €380m in turnover.
“We readjusted our goals to 40-50% revenue growth in 2023 because the macroeconomic conditions deteriorated,” says Alan cofounder Jean-Charles Samuelian-Werve.
It remains a strong result as insurtech has been hit hard by shrinking VC funding during the economic downturn, which has seen many companies in the sector navigating rough waters.
New business
Revenue growth was driven by the expansion of Alan’s customer base, which saw the company sign deals with 5k new businesses.
The scaleup now covers more than 500k employees across France, Belgium and Spain — a jump from 375k users at the end of 2022.
“Our enterprise customers recruited less employees, which meant we acquired fewer members. But the number of new contracts signed with businesses exceeded our objectives,” says Samuelian-Werve.
The company says it expects to reach profitability across the business in 2026 and that it can hit the milestone in France next year.
Shrinking losses
In 2023, Alan saw net losses reduce to €59m compared to €72.4m the previous year. This is because the company recruited less than in 2022 while its turnover increased. It currently has a 550-strong workforce.
Samuelian-Werve says that operational costs also diminished thanks to AI tools that were used across the company to boost teams’ productivity, for example by automating Alan’s reimbursement process.
Better productivity, says Samuelian-Werve, is also why Alan managed to increase its gross margin — the percentage of revenue that’s left after healthcare reimbursements — from 8% in 2022 to 10%.
The company had originally predicted a 13% gross margin for 2023, which Samuelian says will be reached in 2024.
What’s next?
With €180m in the bank, Alan still has most of the money it bagged in a €183m Series E it raised in 2022 — and has no plans to raise more.
“To keep to our plan, maintain this level of growth and reach profitability, we don’t need to raise money,” says Samuelian. “Our cash burn is low.”
“We have received unsolicited offers from investors and we sometimes consider them so it is not impossible, but for now it is not our strategy.”
And although the priority over the next 12 months will be to consolidate the company’s position in France, Spain and Belgium, the founder says that the next few years will probably see Alan launching in new markets.
The scaleup is targeting 40% revenue growth in 2024 and will recruit 30 new employees in the coming year.
An IPO is not on the cards in the near-term. “We don’t have pressure to enter the public market right now,” says Samuelian.
“Will we consider an IPO in the five to six years? Yes, that will definitely be an option.”
