Insurtech Startup Honcho Now Seeking Additional Funding Through Seedrs Equity Crowdfunding Round

UK-based insurtech Honcho has launched an equity crowdfunding campaign on Seedrs. The new crowdfunding campaign less than six months after raising nearly £900,000 through its Crowdcube round.

Honcho revealed that the Seedrs campaign is a follow-on round from the £1.2 million crowd raise completed in April through equity crowdfunding platform Crowdcube. The insurtech noted it returned to the crowd through Seedrs to complete the raise, and further diversify its crowd investor base.

As previously reported, Honcho is described as a reverse-auction marketplace where insurers enter a competitive real-time bidding process in order to offer the best price to customers. The company aimed to launch in Summer 2018 with nearly 20 insurance brands that will pay a £1 fee to bid rather than the average £50 commission charged by comparison sites. Honcho has signed up more than 10,000 consumers, which is notably growing monthly and 14 insurers to its platform.

“We have developed the first online reverse auction marketplace for financial services. A reverse auction is where you, the consumer, receive bids and become the focus of the auction. Companies will compete against each other to win your custom which is how we think it should be! It’s disruptive and innovative, and we’re going to start by launching into the car insurance market in 2018.”

honcho further revealed that its primary revenue stream is its insurer £1 pay-to-bid fee. Contrasting with the hefty commission paid by insurers to PCWs, honcho has no commission.

“By choosing to bid to try to win a consumer’s business – something our £1 fee provides access to – insurers only chase risks that are right for them, at a potentially lower CPA.”

Funds from the Seedrs round will be used for the following:

  • Product: Honcho has already grown its technical team and will continue to do so to support the development of our apps and platform allowing us to significantly grow our capabilities, product features and new markets.
  • Partnerships: Honcho has big plans to grow its partnerships platform across affiliate, affinity, and managed service models.
  • Marketing: Honcho will continue to deliver brand marketing to support its B2B acquisition channels, alongside specific B2C campaigns.

Speaking about the raise on Seedrs, CEO of Honcho, Gavin Sewell, said:

“This will be the third time that we’ve offered an investment in honcho to the general public, and it continues to be a really important part of our investment mix. Whilst we are very well supported by our two institutional investors, crowd investors bring a very different kind of dynamic to our business and one that we’re really keen on. Our crowd investors get to have early access to our products and help shape their design whilst at the same time having the opportunity to invest in an early stage business that, in most startups, would not be possible.”

Honcho is now offering 14.84% in equity at a  £1,226,617 pre-money valuation. The Seedrs campaign is set to close at the end of August.


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