Morning Report: Softbank focuses on property over singularity.
This morning, it was announced that Softbank lead a $120 million investment into Lemonade, a “homeowners and renters insurance powered by artificial intelligence and behavioral economics,” according to Crunchbase. The startup, which underwrites its own insurance policies rather than outsourcing the job, has raised a total of $180 million. Its latest raise has put the company at a pre-money valuation of $500 million.
The Softbank-led round makes this the third largest insurance investment deal of the year, according to a Crunchbase search. It is also another boost to funding amounts in an already very good year for insurance startups, of which these pages covered back in July.
However, what’s most intriguing about this deal is it represents Softbank’s fourth property-focused investment in the past year. Just under two weeks ago, Softbank backed Compass, a real estate buying and selling platform, with a $450 million Series E. It did so with no other investors. And a few months prior to Compass, Softbank signed over $4.4 billion to the coworking joint WeWork, and it also participated in WeWork China’s $500 million funding.
Why, exactly, Softbank is interested in startups with a property bent is not known. Investing in such startups is not likely to bring on, or prevent, the singularity, as Softbank CEO Masayoshi Son has discussed. But overall, startups operating in the sector have seen increased VC interest. Vacation property management startup Vacasa, for instance, raised a $103 million Series E in October.
That aside, Softbank is showing wisps of focus in its investment strategy. If this streak continues into 2018, we’ll let you know.
From The Crunchbase Daily:
- The staggering explosion in cryptocurrency value has attracted a host of fraudsters, thieves, and boosters. The list now includes a number of public companies that are finding often flimsy ways to associate themselves with crypto in hopes of attracting a market spike, Crunchbase News reports.
- Indian ride-hailing service Ola is entering the food delivery space with the acquisition of Foodpanda’s India business. Ola will buy Foodpanda Indiafrom its parent company, DeliveryHero, for an undisclosed sum in an all-stock transaction.
- Insurance startup Lemonade has raised $120 million in a new round led by SoftBank and joined by existing investors. New York-based Lemonade sells homeowners and renters policies, taking a flat fee for its services and pledging to donate to charity any leftover money not paid for claims.
Illustration: Li-Anne Dias