Hippo has closed a $150mn series E financing round that values the homeowners insurtech at $1.5bn.
The latest round brings Hippo’s total funds raised to $359mn. It added new investors FinTLV, Ribbit Capital, Dragoneer and Innovius Capital, which joined existing investors including Felicis Ventures and Iconiq Capital.
Hippo said the funding will be used to accelerate the company’s expansion, including to reach 95 percent of the US homeowner population in the next 12 months, make hires, invest in its technology and support the proposed acquisition of Spinnaker
In addition, Assaf Wand, CEO of Hippo, told Bloomberg that the company is planning an initial public offering. “In 2021, we’ll be ready to go public,” he said.
The capital raise follows the investor excitement around Lemonade’s IPO earlier this month in which the renters insurtech floated at an offering price of $19. Lemonade’s share price has soared, closing yesterday at around $84.
Wand told Bloomberg that the terms of its latest financing round were set before Lemonade’s IPO.
“It started 3 1/2 months ago when the world was really, really shut down,” Wand said, noting that investor pitches were harder via video. “It’s very difficult for me as a founder to intervene to read the room,” he said.
In the past 12 months, Hippo has grown its total written premiums to $270mn, growing at 140 percent year over year.
Hippo was valued at about $1bn in a $100mn series D funding round in July last year that brought its total funding to $209mn.
The insurtech began selling its policies to homeowners in 2017. It initially rolled out in California and is now available to more than 70 percent of the US homeowners population across 29 states. Hippo expanded its product portfolio with products for landlords and new construction.
The company said it has an “aggressive hiring plan” for its Palo Alto, California headquarters and its offices in Austin and Dallas in Texas. It expects to increase its employee count by 100 people this year and will be expanding its Austin, Texas presence with a new Hippo campus that will hold up to 310 employees when it opens next year.
Hippo last month announced the acquisition of program fronting specialist Spinnaker. The insurtech has partnered with Spinnaker as its largest carrier platform since 2017, with Spinnaker-backed Hippo products currently available to consumers in more than 18 states.
Hippo’s programs are written by a panel of reinsurers.
In February this year, it revealed a new panel of reinsurers for its Spinnaker business that includes Arch, Markel, RenaissanceRe and TransRe. They replaced Munich Re, who had previously acted as Hippo’s sole reinsurer for business fronted by Spinnaker.
Hippo is not the only insurtech eying a potential IPO next year. Indian insurance aggregator website Policybazaar this week said it is planning to go public in 2021 in an IPO of about $500mn and a valuation of more than $3.5bn.