Q1 2021 Quarterly InsurTech Briefing

By CB Insights

Q1’21 was a record quarter for insurtech investment activity. Startups raised over $2.5B across 146 deals.

This record level of funding reflects a 180% increase compared to the same period last year, when fears of Covid-19 swelled, and a 22% increase compared to Q4’20, as investment activity steadily bounced back. In addition to funding growth, the number of deals this quarter also grew significantly, including a 52% year-over-year increase and a 42% quarter-over-quarter increase.

Key Highlights:

Global insurtech activity reached an all-time high, with Q1’21 being the strongest on record: In Q1’21, insurtech funding hit an all-time high of $2.5B across 146 deals — increases of 22% and 42%, respectively, from the prior quarter.

Insurtech’s reach becomes increasingly international: Q1’21 marked the most geographically diverse set of early-stage startups in a single quarter, representing 24 countries, including Bangladesh, Estonia, Brazil, Nigeria, and the UAE. For reference, in 2020, insurtechs from 38 different countries raised investment, compared to 29 in 2016.

There were a record number of mega-rounds, earlier on in the funding cycle: Notably, this quarter saw a record number of mega-rounds with 8 companies driving over $1.1B in funding, roughly 44% of total funding raised. While historically late-stage companies (Series D and later) typically land mega-round deals, this quarter, the majority of companies were raising Series C growth rounds, potentially an indication of expanding funding requirements earlier on in the cycle, froth in the markets, or both.

Read the full report here.

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