AI-powered insurance firm announces landmark series C to fuel global expansion.
Japanese telecommunications giant SoftBank has made its play in insurance. The company seeking to own the future, both through its own investments and through those made via its $100bn Vision Fund, has invested $120m in insurtech start-up Lemonade.
The series C fundraise, led by the SoftBank Group, also features participation from existing investors such as Allianz, General Catalyst, GV (Google Ventures) and Sequoia Capital. The money will be used to accelerate Lemonade’s global expansion in 2018.
Lemonade is a technology firm that claims to fully digitise the insurance process. Unusually for a start-up, it is licenced both as a property and casualty insurance carrier. The company began offering homeowners and renters insurance in New York in late 2016 and is now licenced in 25 states. Lemonade has a charitable function named Giveback, which sees a portion of unclaimed premium dollars distributed to non-profits once a year. The latest in cutting-edge technologies, such as AI, are central to its offering.
“The insurance brands we know today came of age in the era of the horse-drawn carriage,” said Daniel Schreiber, CEO and co-founder of Lemonade. “But insurance is best when powered by AI and behavioural economics, which is why we believe that companies built from scratch, on a digital substrate and with a social mission, will enjoy a structural advantage for decades to come.”
The transaction is expected to close in Q1 2018, subject to regulatory approvals and other customary closing conditions. David Thevenon, a senior investment professional at SoftBank, will join Lemonade’s board.
“By combining big data and AI with a seamless user experience, Lemonade is truly revolutionising the insurance industry,” said Thevenon. “We have been impressed by the team’s creative approach to disrupting the traditional insurance model with innovations like Zero Everything policies and Giveback, and we look forward to supporting the company’s rapid growth.”