Wefox is a Berlin-based digital insurance company that intends to keep people safe and prevent risk by reinventing insurance through technology. In a recent development, the company pocketed $650 million (nearly £460 million) in a Series A funding round, which took its valuation to $3 billion.
Largest round for an insurtech
The oversubscribed investment round was led by Target Global along with participation from existing investors, including OMERS Ventures, G Squared, Mountain Partners, Merian, Horizons Ventures, Eurazeo, Salesforce Ventures, CE Innovation Capital (formerly known as CreditEase Fintech Investment Fund), and GR Capital. New investors included FinTLV, Partners Group, EDBI, Jupiter, Decisive, and Ace & Co also pitched in this round. Among the investors are London-based VCs Mubadala Capital, Speedinvest, Seedcamp, and LGT, and its affiliated impact investing platform Lightrock.
Notably, this is the largest round ever for an insurtech company globally and one of the largest Series C rounds as well. Wefox will use the investment to strengthen its presence in the existing markets and expand globally in the next two years.
Julian Teicke, CEO and founder of Wefox, said: “We’ve grown our business significantly over the last six years since we launched and we have delivered strong year-on-year growth. This year we took several important steps, such as unifying the business under one Wefox brand, expanding into Poland, and setting up a deep tech team in Paris. Within the next few years, we will expand our global footprint, increase our presence in Europe, and move into both the US and Asian markets. Wefox will become the leading personal insurance company within the decade.”
Henry Gladwyn at OMERS Ventures said: ‘Wefox has used technology to build a business that delivers great results to consumers, brokers, and reinsurance partners. With focus on execution they have built this quickly and with a clear path to profitability. It continues to be a privilege to work with the Wefox team and we’re proud to be involved in this emerging European success story.”
Fabian Wesemann, CFO and founder of Wefox, said: “This investment strengthens our growth strategy and moves us closer to realising our vision – to prevent 30% of risks from happening – in order to offer the most advanced service to our customers. This investment round is the culmination of six years of hard work and we are still at the very early stage of our business. I want to thank the entire Wefox team for their hard work in enabling us to achieve such incredible results.”
Yaron Valler, General Partner at Target Global, said: “Wefox continues to deliver exceptional results backed with demonstrable year-on-year revenue growth, which saw their insurance carrier, Wefox Insurance, report a profit earlier this year, marking them out to be the first insurtech to reach profitability. We invested in Wefox in their series A round in 2016 and we are delighted to be leading this series C round. Wefox is unique among the insurtech players with ample room for growth ahead.”
Growth in revenue!
Wefox was founded in 2015 by Julian Teicke, Fabian Wesemann, and Dario Fazlic, and has grown its revenues to over $140 million (nearly £100 million) in the 2020 financial year. Also, it reported a profit in 2020 amidst the pandemic crisis through its insurance carrier – Wefox Insurance. The fully licensed digital insurance company that sells insurance through intermediaries and not directly to customers, which has resulted in significant growth with a clear path to profitability.
The company continues to deliver a loss ratio supported in large part by its straight-through-processing (STP) of more than 80%, and a central product factory that swiftly distributes new products to the market due to its full-stack insurance technology.