After $120 Million Round, Lemonade Readies to Go Global

New York skyline, including the Manhattan Bridge, as seen from a rooftop bar in Williamsburg.

Lemonade, a New York-based upstart that pegs itself as a provider of peer-to-peer insurance, raised $120 million in a Series C funding led by SoftBank last month.

The insurtech’s renter and home insurance coverage starts at $5 a month for renters and $25 for homeowners. Lemonade offers at least one insurance product in eight states, with plans to roll out in additional states in the coming years.

With the infusion of cash, it’s the upstart’s stated ambition to launch their product globally next. The insurtech’s ability to scale comes from a reliance on artificial intelligence and chatbots to help service customers and cut bureaucracy.

One of the product’s selling point is the ability for users to get insured just by answering a series of questions in-app. Through the process, the user is asked to select a charitable cause they want to support. Lemonade then offers insurance by pooling user money according to these groups. From each pool, Lemonade itself takes a flat 20 percent fee, pays out claims and covers reinsurance of other pools. Any money left in the pool unused is donated annually to that group’s cause of choice. Lemonade claims that charging a flat rate and donating remaining money eliminates the natural tendency for insurance to “bring out the very worst in people”.

Lemonade is reinsured by syndicates of Lloyd’s of London, among others. Aleph, Allianz, General Catalyst, GV, Sequoia Capital, Sound Ventures, Thrive Capital, Tusk Ventures and XL Innovate also contributed to the funding round.

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Correction: An earlier version of the headline of this article incorrectly stated the amount raised. That has been corrected, Fintech Unltd regrets this error. 

Cadence is a fintech reporter and writer at Fintech Unltd, where she covers the changing landscape of financial technologies. Previously, Cadence interned at Psychology Today, Business Insider and the Wisconsin State Journal. Cadence is interested in how science and technology intersect with power and culture and is curious about the world we are creating for tomorrow, consciously or not. She graduated from the University of Wisconsin–Madison in 2017 with degrees in Journalism and Chinese. Send tips and story ideas to Cadence at [email protected] You can also follow her on Twitter @cadencebambenek.