Software Firm Duck Creek Raises $230 Million Ahead of IPO

(Bloomberg) -- Duck Creek Technologies, a software provider for insurers, has raised $230 million from new and existing investors ahead of a planned initial public offering.

The Boston-based company attracted Kayne Anderson Rudnick Investment Management and Whale Rock Capital Management as new investors, according to a statement reviewed by Bloomberg. The valuation of the company in the round wasn’t included in the statement.

The deal comes as the IPO market is roaring back after the coronavirus pandemic largely sidelined listings. Last week, more than $7 billion was raised globally through first-time share sales, the busiest week this year. On Tuesday, used car sales platform Vroom Inc. scored the year’s second-biggest first-day pop, rising 118% in its trading debut, according to data compiled by Bloomberg.

Duck Creek plans to use the proceeds to invest in business growth as well as to buy back equity from certain existing investors, it said in the statement. The deal is expected to be announced Wednesday.

The company announced in December that it had confidentially filed a draft registration for an IPO. JPMorgan Chase & Co. is the sole placement agent for the private fundraising, according to the statement.

“Our platform’s performance, particularly during these recent months, has shown the industry that SaaS can deliver new levels of value,” Duck Creek Chief Executive Officer Michael Jackowski said in the statement, referring to “software as a service” in which software is licensed on a subscription basis. “We see growing opportunity for Duck Creek as more insurers accelerate their adoption of SaaS solutions for their core systems.”

Duck Creek’s customers include American International Group Inc., Chubb Ltd. and Zurich Insurance Group AG. Its software, focused on property and casualty insurance, is used for policy administration, billing and claims, among other functions.

Apax Partners acquired a majority stake in Duck Creek from Accenture Plc in 2016 and established it as an independent company. Dragoneer Investment Group, Insight Partners, funds advised by Neuberger Berman Investment Advisers LLC and Singapore’s Temasek Holdings Pte participated in a $120 million private fundraising in December, according to a statement at the time. Accenture remained an investor after the sale.

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