- Home insurtech startup Hippo said Tuesday it had secured $150 million in Series E funding, bringing the unicorn's valuation up to $1.5 billion.
- Venture capital firms FinTLV, Ribbit Capital, Dragoneer, and Innovius Capital participated in the funding round.
- Trying to raise money while COVID-19 roiled markets was "a b—-," CEO Assaf Wand said.
- Hippo uses technology to build custom profiles of houses, which it draws on to make custom insurance plans. The company says this nuanced approach saves customers money.
- Hippo plans to hire 100 new employees and is building a new office in Austin, Texas as it prepares for an IPO it hopes to complete in 2021.
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Home insurance tech startup Hippo announced Tuesday it had pulled in $150 million in a Series E funding round that boosted its valuation to $1.5 billion. But getting there wasn't easy.
"Funding was a b—-," CEO and co-founder Assaf Wand told Business Insider.
The unpredictable economic fallout of the COVID-19 pandemic was to blame. The company had to go through a lalorious process of pulling together data on the housing market while the COVID-19 pandemic upended normal patterns.
"When you start the funding, you need to prep the data," Wand said. "You need to do a lot of stuff. Hence, the market was very different three and a half months ago than it was today."
Venture firms FinTLV, Ribbit Capital, Dragoneer, and Innovius Capital participated in the funding round that was based on a $1.5 billion valuation, according to an official release. Hippo had already joined the unicorn club by reaching a valuation of at least $1 billion during a funding round in 2019.
Hippo deploys various kinds of tech to build nuanced profiles of homes. That allows it to create bespoke insurance plans that it says saves money for customers on a case-by-case basis.
Hippo plans to hire 100 new employees and is building a new office in Austin, Texas ahead of its planned 2021 IPO, according to the release. Sales were up 60% in the second quarter of 2020 compared to the same time last year, according to the statement.
Wand said the US home insurance market is too resilient for COVID-19 to dampen Hippo's prospects, although the outbreak had created a change in the company's client base.
There are now a lot more of what Wand calls "switchers.''
"People are staying home and trying to save money and trying to get more modern coverage on their home," Wand said.
Hippo also experienced a bump in May and June as people bought homes and prepared to camp out the pandemic, according to Wand.
"Everybody was cramped into a home for too long, and they said, 'listen: It's not that bad, but what I really need is an extra room in the house, what I really need is a swimming pool, what I really need is an office,'" Wand said.
Hippo's big round follows insurance tech rival Lemonade's announcement in June that it plans to go public. Lemonade is valued at $2 billion.
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