Japanese telecommunications giant SoftBank has parted with a staggering $120 million to invest in New-York based insurance startup Lemonade. The Japanese company follows in the footsteps of some major global organizations who have already backed Lemonade including Allianz, Google Ventures, Sequoia capital and Alphabet Inc.
Lemonade was founded in 2015 with the aim to revolutionize the old-fashioned insurance industry. The company sells insurance to homeowners and to people who rent property in the US in a manner that is simple and involves minimal bureaucracy.
It was able to achieve its objective by essentially replacing brokers and paperwork with bots and machine learning. With Lemonade’s new insurance approach the whole process is instant and painless. What makes the company even cooler is the fact that it is a Certified B-Corp meaning that a portion of its profits goes to charity each year.
The company has come a long way since it first launched its services in 2016. At the beginning it offered its services only within the city of New York but have since expanded and obtained licences in 25 states while obtaining lots of new clients.
The co-founder and CEO of the company, Daniel Schreiber revealed that the startup has been progressing beyond expectations in recent times. “Growth has been in excess of our expectations since our last round. We’ll end this year around 90,000 customers, and our target for the year was 13,000” he commented in an interview.
Lemonade is just one of several New York companies that has attracted attention from SoftBank’s founder, Masayoshi Son, who is armed with roughly $100 billion in venture capital. The Japanese billionaire has already invested $500 million in real estate tech company Compass, $1.1 billion in drug developer Roivant Sciences, and $4.4 billion on co-working space giant, WeWork.
As part of Softbank’s investment conditions, its Managing director David Thevenon will now join the Lemonade board of directors.
“By combining big data and [artificial intelligence] with a seamless user experience, Lemonade is truly revolutionizing the insurance industry, 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,” said Thevenon in response to the news.
The company has revealed that it is going to use its newly received funds to expand its services to new global markets.