Insurtech Metromile announced that Ryan Graves plans to make a $50 million investment in the company both personally and through his investment firm Saltwater. Graves was formerly senior vice president of global operations Uber Technologies.
Graves’ investment includes participation in the $160 million PIPE [private investment in public equity] that will close along with the merger with the SPAC INSU Acquisition Corp. II. Graves investment also includes secondary purchases. Additionally, Graves will join Metromile’s board of directors following the business combination’s close — which is slated to close in the first quarter of this year.
Founded in 2011, Metromile launched its personalized pay-per-mile auto insurance a year later. The premise behind Metromile is that if you don’t drive much, you shouldn’t have to pay as much for auto insurance as those who do drive a lot. Customers pay a base rate, and then pennies per mile, according to the company.
Graves previously served on Uber’s board of directors and served as Uber’s first CEO, first employee and a member of the founding team. Graves is joining the likes of institutional investors, Mark Cuban and Social Capital’s Chamath Palihapitiya in supporting Metromile’s growth plans.
“Metromile has a discipline and long-term orientation reminiscent of Berkshire Hathaway combined with the kind of truly transformative technology that initially attracted me to Uber. The founders and the management team are purpose-driven and have engineered a platform poised to change a massive industry meaningfully,” Graves said in a statement.
Metromile CEO Dan Preston said in an interview with FinLedger that the company will use the additional investment to continue with its business plan, which includes expanding nationwide, growing its product offering and expanding its enterprise software products.
Preston said he likes that Graves has a strong sense of what it takes to be a high growth yet sustainable company.
“One of the things that [Graves] reflected to me was that he was struck by the combination of technology and sustainable growth with a focus on unit economics, which was one of the core aspects of our story that I think has resonated well,” Preston said.
In the past several years, Preston said that the company’s plans included figuring out how to effectively turn business cash flow positive and profitable while consuming the least amount of capital.
“What’s great about this transaction is this allows us to fully fund the business to achieve that profitable outcome,” Preston said. “Something that we think is going to then be a flywheel for us that as we turn profitable allow us to fund future growth effectively without diluting shareholders as long as we continue to grow the business.”
As FinLedger has previously reported, SPACs (special purpose acquisition companies) are becoming an increasingly popular method to go public. For instance, Blackstone-owned wealthtech player Alight Solutions recently announced its going public through a $7.3 billion SPAC merger.
In other insurtech news, Rhino recently raised a $95 million funding round while proptech Porch made multiple acquisitions, notably investing $100 million in an insurtech company.
Ryan Graves also recently participated in a $15 million Series A for Darwin Homes, a single-family rental property management startup. In the fintech world, Graves is also an investor in Cardless.