Yellow Hive

Private Equity Manager (GP)

Case study

About the company

Yellow Hive is a leading Dutch insurance distribution platform with active broker and managing general agent (“MGA”) capabilities. The company, which serves both small and medium-sized enterprises and consumers, is a financial services intermediary for property and casualty insurances, employee benefits, risk assessment and mortgages.

The business is headquartered in the Netherlands and has more than 500 employees.

Investment rationale

• Yellow Hive had a high-quality platform displaying robust historical organic growth supplemented by proven buy-and-build capabilities.
• Resilient business model with expansion into higher margin MGA/niche sectors, which will drive cross-selling opportunities with the potential for significant synergies and economies of scale.
• Fragmented and growing underlying market provides an attractive buy-and-build opportunity.
• A strong alignment with a core, high-quality private equity manager.

Our relationship

Pantheon is an existing primary investor in IK Partners’ (“IK”) Small Cap Fund II and has been an active investor with the private equity manager since 2000, having invested in several of their mid-cap funds on a primary basis and completed eight co-investments.

Active management and value creation

• IK acquired Yellow Hive in 2020 and has since grown revenue and EBITDA by 5.5 and 6.0 times respectively.
• Mergers & Acquisitions are in the DNA of the company. All the business segments are supported by a shared services centre, which enables the business to seamlessly integrate new businesses to the platform, driving efficiency and generating synergies. Furthermore, the company has a good track record of transferring its portfolio of policies into its own MGA channel, and therefore further synergies are anticipated.
• Yellow Hive has the long-term goal of replicating the platform that it has today on a pan-European scale. The company, assisted by IK, has built a pipeline of targets into its plan and aims to execute on this to grow business earnings.