The company, called Ethos, gained considerable value in a Series C round led by big-name backers.
San Francisco-based life insurance start-up, Ethos, has just gained an additional $60 million in funding and is now valued at just about $500 million.
Existing investors include such big name celebs as Jay Z, Will Smith and Robert Downey Jr.
During its Series C round of funding, the life insurance start-up was highly successful, with a round led by Alphabet’s (parent company of Google) venture arm, GV, as well as Goldman Sachs. Its existing investors also came back for more, including Accel and Sequoia Capital.
The company provides term insurance products typically ranging from 10 to 30 years. The firm uses data analytics to predict an applicant’s life expectancy. It does not require its applicants to undergo a medical examination in order to prove their eligibility.
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Following its latest funding round, the life insurance start-up is now valued at nearly $500 million.
Its latest valuation represents a substantial spike. It means that Ethos’ value has more than quadrupled since it was valued at just over $100 million back in October 2018. Equally, the insurance provider has also quadrupled its revenues during that same time span. It currently employs about 90 people, though it had a staff of only 30 people back in October, said its CEO Peter Colis in a CNBC interview.
After this latest round of funding, its funding total has increased to over $100 million. “There is a massive under-penetration of life insurance,” explained Colis. “The families that are financially vulnerable are the ones who need it most. Ethos is able to democratize that system and open access to everyone. I think all these investors resonated by seeing there’s a real opportunity to make an impact.”
According to Roelof Botha, partner at Sequoia, an Ethos investor, while the celebrity-rich investor backing at Ethos may be surprising, it can only be helpful to the brand’s image. “The insurance industry is viewed by most as a bit stodgy, stiff, inaccessible and it affects your ability to distribute life insurance because people are so fearful,” said Botha. He went on to point out that with top celebs behind the company, barriers and fears associated with buying a policy are more likely to “break down”.