Kin – a direct-to-consumer home insurance company built for every new normal – recently announced the closing of a $33 million Series D extension. The funding round was led by QED Investors with participation from returning investors Geodesic Capital, Allegis Capital, Hudson Structured Capital Management Ltd. (doing its reinsurance business as HSCM Bermuda), and Alpha Edison. Kin has now raised about $265 million in equity funding to date.
Investor confidence in Kin continues climbing due to its unique business strategy and market focus, which have produced systematic, capital efficient growth. And the company is on pace to deliver $370+ million in total premium this year and has turned the corner to positive operating income. Plus, Kin is also succeeding in geographies where other legacy insurers are either leaving or stalling growth. These results include stellar profitability metrics like adjusted loss ratio (34.5% through the second quarter and well below industry averages), and strong unit economics like LTV/CAC (13x cumulative ratio through the second quarter).
Kin is transforming a centuries-old industry with a combination of business model, technological, and financial innovation:
1.) Business model – Kin sells directly to consumers, which unlocks massive economic efficiency, and its sophisticated marketing targets customers that are a good match for its risk criteria, thereby creating an appropriately diversified, adequately priced book of business.
2.) Technological – Kin’s technology is the best at programmatically understanding the physical properties of buildings and the company’s homegrown policy platform enables it to implement important changes faster than the competition.
3.) Financial – Kin generates stable, recurring revenue by providing management services to two reciprocal exchanges while also shielding investors from direct insurance risk.
“Investors are putting a premium on growth in the context of profitability, and we’re growing exceptionally fast because we’re able to profitably serve customers who aren’t being well served by incumbents. Because we’re already profitable and well funded, we didn’t need to raise right now, but the additional funding strengthens our liquidity position and can be used to fuel more growth. Also, we were able to raise without too much effort, at the same share price, while so many other technology companies are having trouble securing capital.”
– Sean Harper, CEO of Kin
“Kin is structured to scale and skillfully manage the entire insurance value chain, which is why we’re so excited to double down on our investment in this truly seminal business. By leveraging advanced analytics and led by an experienced and world-class management team, Kin is able to offer terrific service at an affordable price. Their direct-to-consumer approach and vertically integrated value-added chain assures that customers receive a best-in-class experience, even in markets that other insurers are pulling out of. We believe that Kin will be known as the defining company of the insurtech 2.0 era.”
– Amias Gerety, partner at QED