Wefx Insuretech captures $ 400M in 4.5B valuation to overcome recession – TechCrunch

Wefx Insuretech captures $ 400M in 4.5B valuation to overcome recession – TechCrunch

European insurance tech startup Wefx has raised $ 400 million in a Series D round of funding, giving the German company a post-money valuation of $ 4.5 billion. This represents a 50% increase from last year’s সি 3 billion valuation in its Series C round.

Founded in 2015 from Berlin, Wefx sells a variety of insurance products through a combination of in-house and external brokers, bypassing the direct-to-consumer model of insurtech competitors including rival German startup GetSafe. This way of growing users, third-party brokers using Wefx to advise their own clients, how CEO and founder Julian Teacon helped the company double its revenue to 320 million last year. Furthermore, it has already earned $ 200 million in the first four months of 2022, aiming to hit a turnover of $ 600 million by the end of the year, and recently passed 2 million subscribers across the board.

To date, Wefx says it has built a network of about 3,000 independent brokers in its native Germany, while in other markets, such as Switzerland, Germany and Austria, it has trained its own brokers.

“Wefx’s ‘Secret Sauce’ is part of its indirect distribution business model, which has enabled the company to scale faster than any other insurete in the world,” he told TechCrunch. “Our model is unique in the insuretech space, because everything else goes directly to the consumer.”

Customer Acquisition

The main advantage of this model is in the cost of customer acquisitions, which is significantly reduced because its brokers, agents and other partners do most of the spade-work for Wafox. In addition, it allows Wefox to enter new markets more quickly.

“We can then focus on enabling our brokers, agents and affinity partners to target the most profitable clients, which improves our loss ratio and the lifetime value of the client,” Tech added. “Our model enables WeFox to run a higher financial profile that leads us to a clearer path to profitability.”

The method is built on the basic idea that insurance is an underlying complex issue, and people would rather chat with a person and get personal advice. And only then did the technology begin, to register and file claims with all the common mobile apps and online dashboards.

Wefx

Recession

Few industries are vulnerable to economic recession, and insuretech is no different. Just last month, Polysignius cut its workforce by a quarter after raising $ 125 million, while Next Insurance cut about 17%. Elsewhere, a host of publicly traded insuretech companies, including Root, Hippo and Lemonade, are trading on their initial IPO price, the latter reportedly laid off a portion of their workforce in April.

On the contrary, we have seen Something Bumper investment in the Insurtech space, the branch recently attracted a 7 147 million Series C trench at a valuation of $ 1.05 billion, while YuLife snatched $ 120 million at a valuation of $ 800 million last week. Mix the steady flow of small investments into space, and it’s clear that even if the 2022 bumper doesn’t follow in the footsteps of 2021, insurtech isn’t exactly dead in the water.

From WeFox’s point of view, it’s only been a year since it raised a 650 million round of funding, so it’s hard to imagine that it could burn so much cash in such a short time. And, apparently, it didn’t – according to Tech, it wasn’t desperate to raise it again, it’s just future-proofing if it needs money.

“We don’t need cash anymore, but after our Series C round, investors came to us and in the current economic climate we believe it was wise to review the situation and take advantage of the current economic downturn – because we see it as one. Opportunity to grow faster, ”Teicke said.

Wafax’s Series D Round, which compromises equity and debt, was led by Mubadala Investment Company, with the participation of LGT, Horizons Ventures and Omar’s Ventures. Flushing with cash, the company said it plans to enter the new European market in 2022, with long-term plans to expand to the United States and Asia in 2024.

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