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Funding

Insurtech Cover Genius hits unicorn after $100 million series C raise

- October 1, 2021 2 MIN READ
Angus McDonald
Cover Genius co-founder and CEO Angus McDonald
Sydney insurtech Cover Genius has capped a staggering month of capital raises for Australian startups, raising $100 million in a series C.

The round was led by Singapore office of Japanese insurer Sompo Holdings, chipping in around $68 million, joined by Silicon Valley VC G Squared and existing investors.

The funding will be used to expand the insuretech’s global insurance distribution platform and support new e-commerce, property, travel, mobility, auto, B2B and financial services partners.

Cover Genius was founded in 2014 by Angus McDonald, a former Yahoo exec, and Chris Bayley, a former Google BDM, initially selling travel insurance before expanding into other coverage.

It now specialises in providing end-to-end embedded insurance to customers of major digital companies, including Booking Holdings, eBay, Wayfair, Intuit, and Shopee. The Financial Times declared it the world’s fastest-growing insurtech.

While the business would not comment on its valuation following the raise, nor its IPO plans, Bloomberg reported that the business was valued at $1 billion.

McDonald told Bloomberg he doesn’t look at valuations.

“Valuations take care of themselves,” he said.

McDonald, the CEO, said the business has had a massive six months, tripling its gross written premium (GWP) after signing over 20 new partners across multiple industries.

“With 70% of customers wanting embedded insurance integrated into their online experiences, our XCover distribution platform is helping some of the world’s largest global companies exceed their customer expectations of what insurance can be with a single API call,” he said.

“Our technology, licensed in more than 60 countries and all 50 US states, gives our partners the ability to protect their customers, regardless of location, currency or language. This strategic investment will help us expand our capabilities into markets equipped for new lines of distribution.”

Sompo Asia CEO Daniel Neo said the technology behind Cover Genius had them uniquely positioned for a global, platform-based economy.

“The company’s disruptive approach to insurance benefits both customers, who receive a seamless digital experience, and partners that can provide customers global, expandable insurance offerings with dynamic pricing and product recommendations,” he said.

Larry Aschebrook, founder and managing partner of VC G Squared, which has backed some of the world’s biggest tech companies, including Airbnb, Lyft, Space X, Uber, Twitter and Spotify, said his firm was delighted to back the Australian insuretech.

“Cover Genius’ impressive management team has built a global, multi-line insurance offering with what we believe to be unrivalled breadth,” he said.

“The company has partnered with a number of top-tier companies to utilise its insurance distribution platform and has demonstrated clear recurring revenue growth with those partners. We view the unique underwriting customisation as a key differentiator.”

The raise by Cover Genius caps off a massive month of investment rounds for Australian startups, including fintech Airwallex bagging a $275 million in a series E, a $273 million raise by Canva, a $100 million pre-IPO raise for hotels tech startup SiteMinder, and Wollongong BNPL fintech Scalapay also hitting unicorn status after US VC Tiger Global backed a $210 million series A.