Farewill, a UK-based end-of-life services provider that offers online tools for writing wills, organizing probate and arranging cremation, has been acquired by funeral services provider Dignity in an all-stock deal, leading to an emerging The company is valued at £12.9 million ($16.8 million).
The deal is a classic case of an established incumbent chasing growth by acquiring a young digital startup, giving Dignity a larger slice of the dying care services market expected to reach $190 billion by the end of 2020. It is designed to help you earn.
Founded in 2015, Farewill is one of several startups to emerge in a category known as “death tech.” This includes apps to memorialize loved ones and social platforms to support the grieving process. Some companies have raised significant venture capital funding, like Empathy, which emerged from stealth in 2021 by spending $13 million on a digital assistant for bereaved families, and just a few months ago raised an additional $47 million. are.
Meanwhile, Farewill has raised approximately $39 million since its founding from backers including Augmentum Fintech, Highland Europe, Keen Venture Partners, Kindred Capital, and Wise co-founder Taavet Hinrikus. This means that Fairwill's valuation of $16.8 million is far below the capital injected, making it a fire sale at best.
finance
The exact circumstances leading to the sale are unclear, but the VC arm of one of the investors, Daily Mail & General Trust (DMGT), reportedly cut the estimated value of the stake by two-thirds. Reports surfaced in February, suggesting that: Fairwill's valuation had fallen from £86m to £30m. Today's news is worse than that.
Fairwill's latest financial results show an increase in total sales (+31.4%), revenue (+36%), and gross profit (+88.9%) for fiscal year 2023. However, the company's EBITDA (earnings before interest, taxes, depreciation and amortization) has declined. Figures showed the company remained unprofitable, with losses of £4.2 million, but losses had halved compared to the previous year.
In addition to that, the deal is being financed through a stock exchange. Fairwill shareholders will now own investment firm and Dignity majority shareholder Castelnau, after serial entrepreneur Sir Peter Woods' joint venture with SPWOne took Dignity private in a $349 million deal last year. They will own shares in the group.
“Adding Fairwill to Dignity's offering embodies Castelnau's strategic ambitions for Dignity and will help the company drive digital transformation and better serve its customers.” CEO Richard Brown said in a statement.
Dignity's origins date back more than 200 years, but its current form is the result of various mergers and acquisitions. However, by having a digital native rival under its umbrella, the company probably hopes to be able to combine its collective strengths. Dignity operates more than 40 crematoriums in the UK and has a strong on-site presence, but Fairwill's online-focused service looks to complement that. ” they said in a press release.
The Fair Will brand will continue as is and will be operated independently.
“Farewill's mission has always been to make the end-of-life experience as easy and stress-free as possible,” said Farewill co-founder and CEO Dan Garrett (pictured above with Dignity CEO Zillah Byng-Thorne). ) says: statement. “Working with Dignity allows us to stay true to its mission while benefiting from the experience and resources of a company trusted for generations.”
The acquisition is still subject to regulatory approval and is not expected to close before January 1, 2025.