In the complex world of insurance, The Zebra wants to bring simplicity and transparency.
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The Austin-based company, which operates an insurance comparison site, raised $150 million in Series D funding, led by an unnamed investor.
Joining the round were a group of investors, including Weatherford Capital, as well as Accel, which led the company’s $38.5 million Series C last year. The investment brings The Zebra’s total raised to $251.5 million since its 2012 inception, as well as values the company at more than $1 billion, CEO Keith Melnick told Crunchbase News.
After last year’s Series C, Melnick said, 2020 was off to a good start for The Zebra.
“The high season for auto insurance hits in March, which is when people spend their tax refunds on new insurance,” he added. “Then the pandemic hit, and everyone stopped searching for auto insurance, and like others, we saw disruption in demand.”
Taking the disruption head-on, the company refocused on educating consumers on what they do, which included new messaging via television commercials, as well as improved products and strengthened relationships with insurance carriers, Melnick said.
The company was shooting for $80 million in revenue in 2020 and ended up at $75 million, even being profitable for a bit. This year has told a different story: March ended up being a record month in revenue for The Zebra, which brought in $12.5 million, he added.
Similar to the Series C, the company pursued a Series D round, not to fund operations, but to fund growth.
“It was an opportunity to lean in and spend part of the money on education, but also hire faster to get our initiatives done,” Melnick said. “We have had nice success, but we feel we are just scratching the surface to provide help for customers in a confusing market.”
Next up, The Zebra intends to leverage more customer data to create personalized experiences and create more products. The company provides auto and home insurance now, but plans to add rental, life and pet insurance, as well as enabling better communication between agents and customers.
Meanwhile, Accel Partner John Locke said the early- and growth-stage venture capital firm was an early investor in The Zebra. It liked the consumer-focused approach to insurance that didn’t constantly spam customers like other companies did.
“We thought there should be comparison shopping in insurance, which exists in other countries — like Europe — but it took a while for it to take in the U.S.,” Locke said in an interview. “The big thing is The Zebra is at a point where everything is working. The product is great for consumers, and there are more carriers on it, both established companies and insurtech. More than anything, the company feels like it is really working well. The team is excellent, and they have an opportunity to be more aggressive to get their brand out there.”
Illustration: Li-Anne Dias
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