Lemonade, which is set to launch a peer-to-peer (P2P) insurance company, has raised $13 million in an unusually large seed financing round led by Aleph and Sequoia Capital.
Lemonade was founded by veteran Israeli tech entrepreneurs CEO Daniel Schreiber former president of Powermat and president and CTO Shai Winniger, a co-founder of Fiverr.com.
Schreiber said, “Most Americans view insurance as a necessary evil rather than a social good, and that’s something we’d like to change. As a fintech-insurance company, Lemonade is designing around the bureaucracy and conflict that haunt the industry, replacing them with technology and transparency. What makes this exciting is that it requires reinventing the very structure and business model of insurance in ways not available to the legacy insurance carriers.”
It is estimated that P&C (property and casualty) insurance generates $1 trillion of gross margins annually and is dependent on a highly centralized and opaque business architecture the very kind that is most prone to disruption. Lemonade plans on transforming both the economics and the experience of insurance, injecting radical transparency and delightful experience into domains known for neither.
Winniger said, “We’re challenging the way insurance companies work, with a peer-to-peer business model fueled by self-serve technology,” said Wininger, President and CTO. “We’ve seen this kind of combination breathe new life into other industries, and we’re determined to do the same for insurance.”
“It is very unusual for a company to receive $13 million in an initial round of funding,” said Haim Sadger, Partner at Sequoia Capital. “But it is rarer still to find such accomplished founders tackling such a sizable industry with such a compelling solution. We’re betting Lemonade will transform the insurance landscape beyond recognition. It is one to watch.”
“I’ve known Lemonade’s founders for years, and we’re thrilled to be part of their journey from the very start. I can think of no entrepreneurs better equipped to reinvent insurance,” said Michael Eisenberg, Founding Partner at Aleph. “Daniel and Shai are on a mission to deliver a wake-up call for the industry, and a refreshing experience to consumers worldwide.
Published by Globes [online], Israel business news - www.globes-online.com - on December 9, 2015
© Copyright of Globes Publisher Itonut (1983) Ltd. 2015