Lemonade, Inc.

Lemonade is an American insurance company that offers renters, homeowners, and pet health policies in the United States, contents and liability policies in Germany, The Netherlands,[3][4] and France.[5]

Lemonade Insurance Company
TypePublic
NYSE: LMND
IndustryInsurance
FoundedApril 2015 (April 2015)
New York City, United States
FoundersDaniel Schreiber
Shai Wininger
Headquarters
New York City
,
United States
Area served
Multiple U.S. states, France, The Netherlands, Germany
Key people
Daniel Schreiber
(CEO)
Shai Wininger
(President & COO)
ProductsHome, Renters & Pet Insurance
Revenue $67.5 Million (2019)[1]
Number of employees
329 (March 31, 2020)[2]
Websitewww.lemonade.com

Lemonade delivers insurance policies and handles claims through desktop and mobile apps using chatbots. Its business model includes giving underwriting profits to nonprofits of the customers’ choice. This is done annually in an event Lemonade calls “Giveback”.[6]

Lemonade Inc. is backed by investors including Aleph, Sean Grusd, General Catalyst, GV (formerly Google Ventures), Sequoia Capital, Thrive Capital, XL, and Japanese tech investor SoftBank, having raised $120 million as of December 2017.[7]

Lemonade is publicly traded on the New York Stock Exchange under the ticker symbol LMND. As of 2020, Lemonade announced it had passed more than one million active customers.

History

Lemonade was founded by Daniel Schreiber (former president of Powermat), Shai Wininger (co-founder of Fiverr) and Ty Sagalow, in April 2015.[8][9] Dan Ariely joined in 2017 as the Chief Behavioral Officer at Lemonade.[10]

Funding

In December 2015, Lemonade Inc. announced that it secured $13 million in seed funding from Sequoia Capital and Aleph.[8] In August 2016, Lemonade Inc. raised $13 million in funding from XL Innovate (part of XL Group), followed by a $34 million Series B funding round in December of the same year.[11] The Series B round was led by General Catalyst with participation from Thrive Capital, Tusk Ventures, and GV (formerly Google Ventures), the VC arm of Google's parent company Alphabet Inc.[12]

In April 2017, the company announced additional investors: Allianz SE and Ashton Kutcher’s Sound Ventures. In December 2017, Softbank invested an additional $120 million in Lemonade in a Series C round, increasing the total money raised by the company to around $180 million.[13] In April 2019, Lemonade announced a further $300 million investment in a Series D financing led by the SoftBank Group, with participation from Allianz, General Catalyst, GV, OurCrowd, and Thrive Capital, increasing the total money raised by the company to $480 million.[14]

Financials

Lemonade underwrites its own policies and is reinsured at Lloyd’s of London.[15] In 2020, Ohio-based financial analysis firm Demotech rated Lemonade’s financial stability as A-Exceptional.[16]

Initial public offering

On June 8, 2020, Lemonade filed an S-1 form for registration of securities in preparation for an initial public offering.[2] On July 1, 2020, Lemonade Inc. priced 11 million shares at $29.00 per share on the NYSE. Shares began trading on July 2, 2020 under the ticker symbol LMND.[17]

Business model

Lemonade claims that it's business model differs from that of typical insurance companies in that it keeps a flat 25% fee of a customer's premium while setting aside the remaining 75% to pay claims and purchase reinsurance.[18] Unclaimed premiums go to a nonprofit of the user's choosing in an annual "Giveback."[19]

Technology

Lemonade uses chatbots to provide insurance policies and handle claims.[20] In 2016, a customer filed a claim for a stolen coat; after answering a few questions on the app and recording a report on their iPhone, Lemonade claimed that its claims bot set a world record by reviewing, approving and paying the claim in three seconds.[21]

Social good

Lemonade Inc. which is registered as a public benefit corporation, has a stated mission of ‘transforming insurance from a necessary evil into a social good."[22] Upon signing up for Lemonade, users select a nonprofit or charity that will receive payouts on an annual basis from the unclaimed premiums (also known as underwriting profit) of their respective cohort.[23]

In May 2016, Lemonade became one of the few insurance companies to receive B-Corporation certification.[24]

See also

References
  1. https://www.sec.gov/Archives/edgar/data/1691421/000104746920003846/a2241899zs-1a.htm#:~:text=Our%20revenue%20was%20%242%20million,net%20losses%20were%20%2437%20million.
  2. https://sec.report/Document/0001047469-20-003416/
  3. "Lemonade Launches in the Netherlands". www.businesswire.com. 2020-04-02. Retrieved 2020-05-03.
  4. "Lemonade Launches in the Netherlands". www.bloomberg.com. Retrieved 2020-05-03.
  5. "Lemonade launches its renters insurance in France". www.techcrunch.com. Retrieved 2020-12-07.
  6. "The Lemonade Giveback & Social Good | Lemonade". www.lemonade.com. Retrieved 2018-05-31.
  7. "Plasmonics startup receives $1 million from venture capital firm". Physics Today. 2013. doi:10.1063/pt.5.027153. ISSN 1945-0699.
  8. Shieber, Jonathan. "Sequoia Invests $13 Million In A Seed Round For Lemonade, Which Is Looking To Transform Insurance | TechCrunch". Retrieved 2017-08-09.
  9. https://www.crunchbase.com/organization/lemonade
  10. "A top psychologist says insurance sucks, so he's joining a startup to fix it". Business Insider. Retrieved 2017-08-09.
  11. Lemonade. "Lemonade Announces Additional Funding by XL Innovate". www.prnewswire.com. Retrieved 2017-08-09.
  12. "Google participates in Lemonade's $34M round". Business Insider. Retrieved 2017-08-09.
  13. "Lemonade Raises A $120M Series C, Softbank's Fourth Investment Into A Property Startup". www.crunchbase.com. Retrieved 2018-05-20.
  14. Azevedo, Mary Ann (2019-04-11). "Insurance Startup Lemonade Gets Sweeter With $300M Infusion". Crunchbase News. Retrieved 2020-05-03.
  15. "Leading Reinsurers Line Up for Lemonade, the P2P Insurer". Insurance Journal. 2016-02-09. Retrieved 2017-08-09.
  16. "Financial Stability Ratings®: Demotech". www.demotech.com. Retrieved 2017-08-09.
  17. "Lemonade Announces Pricing of Initial Public Offering". www.businesswire.com. 2020-07-01. Retrieved 2020-12-08.
  18. Moodie, Alison (2017-01-28). "How artificial intelligence could help make the insurance industry trustworthy". The Guardian. ISSN 0261-3077. Retrieved 2017-08-09.
  19. "How is Lemonade Different Than Mutual Insurance?". My Money Blog. 2017-04-10. Retrieved 2017-08-09.
  20. "Lemonade are Live. Insurance will never be the same again!". www.the-digital-insurer.com. Retrieved 2017-08-09.
  21. "A New York startup shakes up the insurance business". The Economist. Retrieved 2017-08-09.
  22. Moodie, Alison (2017-01-28). "How artificial intelligence could help make the insurance industry trustworthy". The Guardian. ISSN 0261-3077. Retrieved 2020-05-03.
  23. Shieber, Jonathan. "Less exciting than Beyonce's album, but maybe more rewarding, Lemonade launches new insurance plans | TechCrunch". Retrieved 2017-08-09.
  24. Lynn, Jordan. "Major disruptor Lemonade in double industry first". Insurance Business. Retrieved 2017-08-09.
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.