Lemonade insurance rival Wefox hits a $3 billion valuation after raising a record $650 million round

Summary List PlacementBerlin’s Wefox has hit a $3 billion valuation after raising a $650 million mega-round, a record figure for an insurance startup.
Founded in 2015, the company offers direct-to-consumer insurance products alongside its main platform, which connects brokers to customers. It has previously said it wants to become “the Stripe of insurance”, in reference to the ubiquitous payments platform.
Speaking to Insider on Friday, Wefox CEO Julian Teicke said the firm wanted to be the “dominant player”, and that the startup could have gobbled up as much as $1 billion in funding for this Series C round.
The round has taken some time to close, with Insider first reporting last October that Wefox was in funding discussions with prospective backers. Sifted reported in March that the fundraise had stalled.
Teicke told Insider on Friday that the startup had sought the right backers. “No company in the space now has deeper pockets than our cap table, we have sovereign wealth funds, banks etcetera, so unlimited firepower,” he said.
The round was led by Target Global, and was backed by a bevy of other investors including Singapore’s Economic Development Board (EDBI).
Wefox eyeing profitability in 2021, fields SPAC offers
Wefox offers motor, home, and liability insurance products and will soon offer a service called Wefox Prevent — a risk-prevention product that will use data from smartphones and other connected devices to warn users of impending danger.
The business is hoping to hit profitability with expected revenues of $365 million in 2021, Teicke previously told Reuters. The company has opened a new artificial intelligence office in Paris, where a team of deep-tech specialists focus on moonshots to improve the business. Wefox Prevent emerged from the Paris team.
The deal follows other big rounds for insurance startups. Clark, another German startup, raised $85 million from Tencent in January.  US firm Lemonade uses artificial intelligence to help make decisions around insurance — sometimes controversially — and went public in July 2020.
Teicke has previously said Wefox, like other hot European startups, had fielded offers about going public via a merger with a blank-check vehicle, aka a SPAC. He has not confirmed whether Wefox will go public, saying the firm was focused on its numbers.
He remains combative about the firm and the broader prospects for European insurance startups, saying: “We are not like the old giants, we are a new giant in the making.”Join the conversation about this story » NOW WATCH: Why thoroughbred horse semen is the world’s most expensive liquid
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