InsurTech

Lemonade seeks to squeeze up to $808 million in secondary offering

The insurtech's stock slumps on the news

Insurtech Lemonade filed paperwork Jan. 11 seeking to squeeze as much as $808 million from a secondary offering.

The New York City-based company plans to sell 3 million shares of common stock, with underwriters having the option to sell nearly 680,000 more shares. In addition, several stockholders plan to sell a little over 1.5 million shares of common stock. Lemonade will not receive proceeds from the stockholders’ sale. The company hasn’t assigned a per-share price to the offering.

Lemonade’s filing with the U.S. Securities and Exchange Commission (SEC) shows two major stockholders plan to sell the bulk of the more than 1.5 million shares outside of its direct offering. General Catalyst wants to sell nearly 516,000 shares and Harel Insurance nearly 459,000 shares.

In July, Lemonade raised $319 million through its IPO, with an initial share price of $29 and a closing price of $69.41. The company’s stock closed Jan. 11 at $183.26, up 14% from its closing price Jan. 8 on the New York Stock Exchange. The Jan. 11 closing price was a record high; Lemonade announced the stock offering after the market closed.

Before going public, Lemonade had raised $480 million since being founded in 2015. Aside from General Catalyst, investors in the company’s funding rounds included Softbank, Allianz, GV, Thrive Capital, Sequoia Capital, Asian Cowboy and G Squared.

For the nine months ended Sept. 30, Lemonade reported $74 million in revenue with a net loss of $88 million. During the same period, the company’s gross written premium — a key indicator of an insurer’s financial success — totaled $156 million. Lemonade sells homeowners, renters and pet insurance, and plans to add auto and life insurance policies.

Lemonade closed 2020 with more than 1 million customers. For the year, Lemonade has projected revenue of $91 million to $93 million.

“With every new customer, our system grows smarter, our underwriting gets better, and our prices become more accurate and fair,” Shai Wininger, Lemonade’s co-founder and chief operating officer, said in a news release.

Lemonade sells policies in most of the U.S., as well as France, Germany and the Netherlands. As a Certified B Corporation, the company donates some of its premiums to nonprofits.

The company’s stock opened lower in reaction to the news. After closing at $183.26 on January 11, it opened at $154.95. By mid-morning Tuesday, it had rebounded some and was trading at around $177 per share.

Latest Articles

2022 HousingWire TECH100 Real Estate Honorees HW+
Mar 11, 2022 By

This year’s list of TECH100 Real Estate honorees represent a huge shift in the direction that the real estate industry is heading in. Though real estate may have fallen behind in technological advances compared to other industries in the past, all of that is changing, and this year’s list of Tech100 winners embody that shift. […]

Content from our partners

Log In

Forgot Password?

Don't have an account? Please

Register

Forgot Password

Please enter your registered email address below to receive a password reset link.

Check Your Email

A password reset email has been sent to the email address on file for your account, but may take several minutes to show up in your inbox. Please wait at least 10 minutes before attempting another reset.

Welcome to FinAssist

Go to your inbox and open 'Welcome to FinAssist, your company discovery platform' to get started. You may also skip your inbox and 'Start tutorial'.