# Beam Financial Model Digital-first dental insurance company selling group dental (and ancillary) benefits to employers via brokers - Canonical: https://finamodel.com/startups/beam - Excel download: https://finamodel.com/startup-models/beam.xlsx - Category: InsurTech - Model type: Insurance GWP - Funding round: Series E - Funding: $80M - Founded: 2021 - Geography: US; 40+ live states [DECK]; 400,000+ provider access points across all 50 states [DECK] - Customer: B2B2C ## About the company Beam is a digital dental-insurance carrier selling group benefits to employers through brokers. Its platform combines quoting, administration, wellness engagement, and AI underwriting, with a connected toothbrush program supplying behavioral data. The company had more than 100,000 members, 5,000 employers, 2,000 activated brokerages, and loss ratio below 70%. Dental premiums are the primary revenue source, while vision, life, and disability products add bundled premium and retention opportunities. The model is group-insurance GWP. Members, premium per member, employer groups, ancillary attachment, loss ratio, claims, broker expense, and administration costs determine underwriting profit. Broker productivity, retention, and underwriting improvement are the key sensitivities. ## What's included - 5-year monthly revenue build with stage-appropriate growth assumptions - Full P&L, headcount plan, and operating-expense schedule - Cash-flow statement, runway, and burn-rate tracking - Valuation via exit multiple with a DCF cross-check - Returns analysis with MOIC and IRR - Unit economics including CAC, LTV, payback, and cohort retention ## Product & value proposition - Digitally-native dental insurance platform - the only fully digital-native carrier in the segment - Three differentiated pillars: 1. **Digital admin suite** - replaces analog enrollment, quoting, and client-tool processes; brokers, clients, members, and providers all on one platform 2. **AI-powered underwriting** - proprietary models that have driven loss ratio from 88% (Q1'18) to 69% (Q2'20) 3. **Beam Perks wellness program** - smart toothbrush + brushing tracking tied to rewards; used as a data input for underwriting and member engagement - Sells to employers of all sizes; distributed through 2,000+ activated brokerages - 50%+ of revenue managed on digital admin platforms (Rippling, Gusto, Ease, BenefitFocus, Zenefits, etc.) ## Market - Dental & ancillary insurance market: $75B+; also cited as $210B Dental & Ancillary in the competitive comparison table - Note: $75B likely refers to dental-only private insurance; $210B is a broader dental + ancillary figure from slide 4 - Medical insurance market: $750B - cited for context only - Market characterised as: high predictability, low-medium loss severity (capped), low regulation vs. medical - explicitly positioned as the most favorable InsurTech segment ## Revenue model - **Primary:** Dental insurance premiums collected from employers (group policies); revenue = Written Premium × (1 − Loss Ratio − Admin Cost %) - **Secondary / bundled:** Vision insurance (VSP Global partnership) and LiDi (life/disability) sold alongside dental; bundling generates 12% of revenue currently, projected at 17% by Jan '23 - **Channel:** Broker-led (2,000+ activated brokerages); HUB, OneDigital, Acrisure, National General Insurance cited as partners; digital admin platforms (Rippling, Gusto, etc.) generate 50%+ of premium - Pricing / premium per member: Not explicitly stated in deck - ARR framing used for cross-sell bundling projections - suggests management thinks in recurring premium terms ## Traction & metrics All from slide 2 unless noted: - **Members:** 100,000+ (~2x YoY increase) - **Employers:** 5,000+ (~2x YoY increase) - **Net Revenue Retention:** 100%+ - **Loss Ratio:** <70% (most recent period) - **Live States:** 40+ - **Activated Brokerages:** 2,000+ - **Capital Raised:** $88M - **Headcount:** 225 - **Admin Labor % of Dental Premium:** 10.5% (2019) → 9.5% (2020) → 6.8% (2021) → 5.3% (2022); industry range 16–20% - **Loss Ratio trend:** 88% (Q1'18) → 84% (Q2'18) → 82% (Q3'18) → 82% (Q4'18) → 84% (Q1'19) → 80% (Q2'19) → 77% (Q3'19) → 76% (Q4'19) → 77% (Q1'20) → 69% (Q2'20); mature incumbents range 65–75% - **Cross-sell ARR (Vision + LiDi as % of Total ARR):** 3.6% (Jan'18) → 9.4% (Jan'19) → 11.7% (Jan'20) → 13.1% (Jan'21P) → 15.3% (Jan'22P) → 17.0% (Jan'23P) - **Vision attachment rate:** 64%+ - **Digital platform revenue share:** 50%+ of revenue managed on digital admin/distributor platforms ## Unit economics - **Loss Ratio:** <70% at latest; declining trend from 88% since Q1'18; mature incumbents 65–75% - **Admin Labor % of Premium:** 5.3% (2022) vs. industry 16–20% - the primary structural cost advantage claim - **Net Revenue Retention:** 100%+ - implies low churn + upsell on existing employer accounts ## Competition / moat - Legacy carriers: Delta Dental, MetLife, VSP (dental); United, BCBS, Kaiser (medical) - InsurTech peers named: Bright Health, Clover, Oscar (medical); Root, Clearcover, Metromile (auto); Hippo, Kin, Lemonade (home) - Beam is the sole dental InsurTech called out - Moat claims: 1. Proprietary AI underwriting driving industry-leading loss ratio improvement 2. Structural admin cost advantage (5.3% vs. 16–20% industry) via digital ops 3. Digitally-native platform creating broker/employer/member stickiness; 100%+ NRR 4. Beam Perks wellness data flywheel - toothbrush data → better risk selection 5. Deep digital distribution integrations (13+ platform partners) reducing CAC and churn ## Team & funding ask / use of funds - **Founders (all Co-Founders):** - Alex Frommeyer - CEO - Alex Curry - VP Insurance - Dan Dykes - VP People & Ops - **Key executives:** Paul Sveen (CFO, ex-PayPal/Swift Financial), Brian Hough (CTO, ex-BleacherReport/New Relic), Cole Gillespie (CRO, ex-LendingClub), Susan Jacobs (SVP Marketing, ex-Nationwide/Hertz), Kelly North (VP Sales, ex-PayCor), Brian Lelio (Head of Strategic Partnerships, ex-MetLife/Guardian Life), Kristen Stovell (VP Analytics, ex-IGS Energy) - **Investors:** Georgian Partners, Kleiner Perkins, Drive Capital - **Capital raised to date:** $88M --- ## Recommended financial model - **Archetype + why:** Insurance GWP / Loss-Ratio P&L (group dental InsurTech). Revenue is driven by written premium (members × average premium per member), not product unit sales. The core P&L logic is: Gross Written Premium → Net Earned Premium → Claims (LR%) → Gross Profit → OpEx (admin labor, sales, tech) → Underwriting Income. A full 3-statement is warranted given $88M raised and growth stage, but the insurance-specific ratios (LR, MLR equivalent, admin expense ratio, combined ratio) are the central outputs. - **Forecast horizon & granularity:** 5-year annual (2022–2026), with monthly detail for Year 1. Quarterly LR tracking is meaningful given the deck's own quarterly LR disclosure. - **Key drivers & assumptions:** | Driver | Value | Source | | -- | -- | -- | | Members at period start | 100,000+ | - | | Member growth rate (YoY) | ~2x (100%) | - | | Avg. annual premium per member (APPM) | ~$600–$900 | Typical group dental APPM range; no figure in deck | | Loss Ratio | 69% (base); declining trend | - | | LR target (mature) | 65–68% | Below incumbent range of 65–75%; consistent with deck trajectory | | Admin Labor % of Premium | 5.3% (2022) | - | | Admin Labor % target | ~4–5% | Continued digitization leverage | | Other OpEx % of Premium (tech, G&A, sales) | ~15–20% | No breakdown in deck; typical InsurTech at scale | | Net Revenue Retention | 100%+ | - | | Employer churn | <5% | Implied by 100%+ NRR; use 3–5% sensitivity | | Avg. employees per employer group | 20 | SMB-skewed; no figure in deck | | Bundling revenue as % of total ARR | 12% current; 17% by Jan'23 projected | - | | Vision attachment rate | 64%+ | - | | Digital platform revenue share | 50%+ | - | | Headcount growth (225 today) | Linked to member/premium growth; ~30–40% YoY at this stage | | States live | 40+ → 50 | ; full national rollout over forecast period | - **Scenarios (Base / Bull / Bear - which variables flex):** - **Base:** Member growth 80% YoY tapering to 30% by year 5; LR stabilizes at 67%; admin cost at 5%; bundling hits 17% of ARR by '23 - **Bull:** Member growth sustains at 100%+ for 2 more years; LR reaches 63% (below incumbents); ancillary bundling hits 22% of ARR; APPM expansion via premium upsell - **Bear:** Growth slows to 40% YoY (broker competition, macro); LR creeps up to 75% (adverse selection or economic stress → deferred dental care then catch-up); admin costs plateau at 6% - **Required sheets / outputs:** 1. **Assumptions** - all drivers centralized with / tags 2. **Premium Build** - Members × APPM → GWP; split dental vs. ancillary 3. **P&L (Insurance format)** - GWP, ceded reinsurance (if any), NEP, claims (LR × NEP), gross profit, admin expense, sales & marketing, tech & product, G&A, underwriting income/loss, EBITDA 4. **Combined Ratio Tracker** - LR + expense ratio + combined ratio vs. incumbents 5. **Unit Economics** - LTV / CAC (once CAC data available or assumed), NRR waterfall, payback 6. **Member / Employer Cohort Model** - new adds, churn, net, cumulative; retention by cohort year 7. **Bundling Revenue Schedule** - dental base + vision + LiDi cross-sell over time 8. **Headcount & Opex** - 225 base; roles tied to growth levers 9. **Balance Sheet & Cash** - simplified; track capital raised vs. burn to implied runway 10. **Dashboard** - LR trend, combined ratio, member growth, NRR, premium per member, cash runway ## Frequently asked questions ### Is the Beam financial model free? Yes. The Beam model is a free Excel download with live formulas. ### Can I change the assumptions? Yes. The workbook is editable and its live formulas recalculate when assumptions change.