Investment has been completed on Jan 19, 2021
- Net profit
Lemonade is changing the big and clumsy insurance industry. The company developed a mobile app that uses artificial intelligence and allows each user to create a customized policy in 90 seconds and receive a payout in 3 seconds.
Investment in Lemonade ended with +172% result.
Lemonade uses AI bots that automatically deliver insurance through its app in the U.S. and Europe. The company was founded in April 2015 by Daniel Schreiber (former president of Powermat Technologies), Shai Wininger (co-founder of Fiverr) and Ty Sagalow. It is headquartered in New York, USA.
The company seeks to remedy the shortcomings of traditional insurance such as defaults on payouts, protracted claims processing and reduced insurance payouts. A three-minute chat with its bot, AI Maya, gets a user covered with insurance. Claims are filed by chatting to another bot, AI Jim, who pays claims in as little as three seconds.
Lemonade’s core product is renters and homeowners insurance at a fixed monthly rate. The company is licensed to conduct our insurance business in 41 states of the United States. In May 2019, Lemonade promised to expand into Europe and launched the app in Germany and the Netherlands.
Lemonade is a fast-growing company: in the three years from 2018 to 2020, it more than quadrupled its revenue – from $22.5M to $94.4M.
Well-known venture funds such as Sequoia Capital (invested in Apple, Instagram, NVIDIA, Medallia, Health Catalyst), Google Ventures (invested in Slack, Uber, Cloudera), Softbank (invested in Slack, Uber, Guardant Health) invested in the company.
In June 2020 Lemonade was named on the 2021 CNBC Disruptor 50 list.
Lemonade is the first technology-driven insurance company to go public. Lemonade is growing faster than all its rivals. The company has gained 1M users in just 4 years (in 2020). That's about 15-45 years faster than industry leaders like State Farm, Allstate, GEICO, and USAA.
The global digital insurance market is estimated to go from $1.46T in 2020 to $11.940T in 2027. None of the players currently has more than 4% of the market share.
We bought Lemonade stock at $47.5 in August 2019. In July 2020, Lemonade had an IPO and was the first private company in our portfolio to go public.
At the pre-IPO stage, for investors, the lock-up period expired in 6 months. In January the deal closed at $156.37, with the result of +172%.