UK Start Marshmallow It has exploited over the years through the use of innovations in data science to build car insurance policies for immigrants and other consumers that have been overlooked or with a price outside the traditional insurance. Now, with a million insured drivers and a profitable annual income rate of $ 500 million, Marshmallow has raised $ 90 million to expand.
Marshmallow plans to use the funds to move on to financial services, as well as more insurance products that they expect to attract a population of people who, despite the chilling effects of Brexit, – – It is growing.
“We think of migration as a great opportunity,” said the CEO Oliver Kent-Abraham in an interview. He pointed out that in the United Kingdom, there are more people who leave the workforce of what there are, with 1.2 million migrants registered in the United Kingdom only in 2024. “We need migration to put more people at work, and we want to help people move and integrate into the United Kingdom”
In Marshmallow’s opinion, that integration comes with being able to drive its own insured vehicle and soon, the Startup waiting, the purchase of housing insurance and obtaining loans.
Marshmallow plans to launch its first loan product at the end of this year, said Kent-Babaham, on the way to build a “unique window” for all the financial and insurance that a new arrival to the United Kingdom may need to adapt to life.
This round is divided approximately 50-50 between capital and debt, according to Kent-Abraham, and is being valued of just over $ 2 billion. To put that in context, Marshmallow raised funds at $ 1.25 billion in 2021.
The startup has seen considerable growth in the business front at that time. In 2021, Marshmallow had assured only 100,000 people. Now, in cities like London, the insured number of 1 million is reinforced with a pink outdoor campaign that is difficult to lose.
Portage capital leads the round, with the participation of Blackrock and Columbia Lake Partners. The company’s previous sponsors have included Pasion Capital, Investte and Scor. Marshmallow has raised around $ 220 million to date.
In particular, the new round has been in process from at least Januaryand Kent-Babaham pointed out that a part of the heritage was a convertible debt raised in 2023.
Marshmallow financing comes at a complex time for new insurance companies in Europe.
On the one hand, there is the gloomy history of Wefox.
Backed by SoftBank, Omers, Salesforce and dozens of others, Wefox’s assessment increased so much $ 4.5 billion By 2023. Only two years later, after years of losses and complications in its distributed/corridor business model, Wefox has fallen into difficult times. The company has been Sell parts of your business and collecting Life financing to be afloat.
However, there are also some brightest signs of new insurtech companies that build more sustainable businesses. And those who can demonstrate a solid technology history are receiving investor attention.
Last week, Skip – A new Startup of Poland – collected an important strategic investor that invested $ 10 million at an assessment of more than $ 200 million. It was the first time that I OMINIMO raised external money after becoming profitable while it was torn. Like Marshmallow, the startup began with automobile insurance and is rethinking actuarial formulas and the use of AI to make new incursions in risk prediction.
While data science and AI are quickly becoming table bets for new insurance companies, there are other details about Marshmallow that distinguish it from the package and even some of its largest competitors (such as the mega delay in Tesco prices).
The ideas of inclusion and diversity that support how Marshmallow is approaching its target client base that works deeply at the beginning.
Kent-Babaham co-founded Marshmallow, based in London, with his identical twin, Alexander, and David Goaté. The twins really look a lot similar. “You could really be talking to Alexander right now!” Oliver joked when we talked about this story. However, more seriously, the startup is a rarity surreated in another way too.
It is one of what seems to be only two new “unicorn” companies in the United Kingdom of one black founder, the other is Worldremit. Statistics are not very encouraging outside the United Kingdom; one Study 2024 He discovered that throughout the United Kingdom and the US, only 3% of the new companies with valuations of more than $ 1 billion have black founders.
At a time when programs for diversity, equity and inclusion are dismantling in the United States, it is notable that Marshmallow investors see precisely the strength because of its diverse leadership.
“This is a very strong founding team,” said Devon Kirk, GP and Co-Cabeza de Portage Capital Solutions, in an interview. “We believe that financial services benefit from different perspectives and leaders who receive innovative solutions to address those needs.”
