European insurtech start-up Wefox wins $ 650 million for a valuation of $ 3 billion – TechCrunch
German start-up Wefox has raised $ 650 million in a Series C funding round led by Target Global. After this round of financing, the company reached a post-financing valuation of $ 3 billion. Wefox is a digital insurance company specializing in personal insurance products such as household property insurance, auto insurance, and personal liability insurance.
“It’s much more than what we originally wanted. It’s a very fast process and we’ve been inundated with almost four times as many apps, ”said co-founder and CEO Julian Takeke (pictured left). ) Said.
In December 2019, the company announced a valuation of $ 1.65 billion. And the company says today’s funding cycle is one of the largest C-Series cycles to date, and more specifically, it is possibly the largest C-Series cycle for businesses. insurtech. ..
“Almost all of the big existing investors are involved,” says Teicke. OMERS Ventures, G Squared, Mountain Partners, Merian, European Ventures, Eurazeo, Mubadala Capital, Salesforce Ventures, Speedinvest, CE Innovation Capital, GR Capital and Seedcamp all join this founding round of Wefox. .. New investors include FinTLV, Ace & Co, LGT and the associated impact investing platforms Lightrock, Partners Group, EDBI, Jupiter and Decisive.
“We not only collected a considerable amount of money, but we also collected it in a very short time. It took us four weeks in total to fulfill all of our commitments, ”said Fabian, co-founder and CFO. Wesemann (pictured right) told me.
Wefox believes it can be iterative and generate more income as he grows older. You need capital to reach the next level. “We are working on a $ 5.2 trillion industry that was stuck in the pre-Internet age. We found a way to destroy it in the main market, ”says Teicke.
But what makes Wefox different from traditional insurers? Wefox is not a direct consumer insurer. Most insurance products are still sold by agencies, and startups believe that won’t change anytime soon.
This is why Wefox has 700 agents who exclusively sell Wefox products. We also work in partnership with associate brokers to sell Wefox products to approximately 5,000 companies.
“Others in the industry seem to be saying human agents are dead, but we think it’s more important than ever,” Takeke said.
In 2020 alone, the company generated $ 140 million in revenue. Regarding its insurance company, Wefox Insurance, the company declared a surplus in 2020.
This rapid growth rate and the clear path to monetization means Wefox has an ambitious track record. As a fully licensed insurance company in Liechtenstein, Wefox can transfer its licenses to other European countries. The company currently has five markets and is working to expand into Italy in the near future.
In addition to new markets, Wefox plans to sell new insurance products such as non-life insurance, pet insurance, health insurance and life insurance. “We are launching around 20 new insurance products this year,” says Teicke.
Distribution is decentralized by a local agency which talks to local clients, while insurance products are managed centrally. Startups prioritize products based on revenue potential and remove one product at a time from the list.
Finally, Wefox has ambitious management cost reduction plans. The company has invested in automation so that common processes are processed by algorithms. Currently, 80% of the process is handled automatically. This is a never-ending process, as you have to adapt the process when launching a new product.
Wefox is also working on prevention. The company first formed an AI team in Paris to prevent bad things from happening. As is often the case with insurers, it’s about optimizing every layer and step of the customer journey to create a product that sets it apart from existing products.
European insurtech start-up Wefox wins $ 650 million for a valuation of $ 3 billion