Lemonade Inc., experts to serve the world’s first peer-to-peer (P2P) insurance company, just stepped out of “stealth mode” and into the limelight, to launch as the first P2P insurance company in the world. The NYC-headquarted startup has secured $13 million funding in a round led by Aleph and Sequoia Capital. Founded by veteran tech entrepreneurs Daniel Schreiber (recently president of Powermat) and Shai Wininger ( co-founder of Fiverr.com).
“Most Americans view insurance as a necessary evil rather than a social good, and that’s something we’d like to change,” commented Schreiber, Lemonade’s CEO. “As a fintech-insurance company, Lemonade is designing around the bureaucracy and conflict that haunt the industry, replacing them with technology and transparency. What makes this exciting is that it requires reinventing the very structure and business model of insurance in ways not available to the legacy insurance carriers.”
It is estimated that property and casualty insurance generates $1 trillion of gross margins annually and is dependent on a highly centralized and opaque business architecture – the very kind that is most prone to disruption, according to the release. Lemonade plans to transform both the economics and the experience of insurance, “injecting radical transparency” and “delight” into domains renowned for neither.
“We’re challenging the way insurance companies work, with a peer-to-peer business model fueled by self-serve technology,” said Wininger, President and CTO. “We’ve seen this kind of combination breathe new life into other industries, and we’re determined to do the same for insurance.”
Industry leader Sequoia helps a small number of daring founders build legendary companies. Reader may be (!) familiar with some of Sequoia’s partners including Steve Jobs, Larry Ellison, John Morgridge, Jerry Yang, Elon Musk, Larry Page, Jan Koum, Brian Chesky, Drew Houston, Adi Tatarko and Jack Dorsey. In aggregate, Sequoia-backed companies account for more than 20% of NASDAQ’s total value.
“It is very unusual for a company to receive $13 million in an initial round of funding,” said Haim Sadger, Partner at Sequoia Capital. “But it is rarer still to find such accomplished founders tackling such a sizable industry with such a compelling solution. We’re betting Lemonade will transform the insurance landscape beyond recognition. It is one to watch.”
Aleph, a $150M vc fund focused on partnering with entrepreneurs to help scale them into large companies with globally recognized brands, was started by Eden Shochat and Michael Eisenberg in 2013.
“I’ve known Lemonade’s founders for years, and we’re thrilled to be part of their journey from the very start. I can think of no entrepreneurs better equipped to reinvent insurance,” said Michael Eisenberg, Founding Partner at Aleph. “Daniel and Shai are on a mission to deliver a wake up call for the industry, and a refreshing experience to consumers worldwide.”
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