Gurugram-based online insurance startup PolicyBazaar has raised more than $200 Mn in a new investment round led by SoftBank Vision Fund. The Series F round of PolicyBazaar also saw the participation of its existing investor InfoEdge (Naukri.com).
Inc42 had earlier reported that the latest investment from SoftBank would enable PolicyBazaar to enter the celebrated Unicorn Club. Although, there isn’t any update on this matter by the company, according to reports, the round values the company at more than $1 Bn.
Founded in 2008 by IIT Delhi and IIM Ahmedabad alumni Yashish Dahiya, Alok Bansal and Avaneesh Nirjar, PolicyBazaar is an online platform allowing users to life insurance and general insurance. The startup also features products from all major insurance companies in India, to help its users decide the policy which suits them the best.
Its parent company, Gurugram-based eTechAces Marketing and Consulting Pvt Ltd, also runs PaisaBazaar, a marketplace for loans and credit cards.
Commenting on the fundraise, Yashish Dahiya, Co-Founder and Group CEO, EtechAces said: “We are very pleased to welcome Softbank Vision Fund on board as our stakeholder. SoftBank’s culture of backing disruptive businesses and industry leaders with long-term capital investment gels well with our own values and vision of creating a transparent and empowering financial products marketplace. We hope to gain a lot from their global footprint and experience.”
PolicyBazaar had broken even during FY17, after chalking a total revenue of $33.8 Mn (INR 220 Cr) in the said period. In December 2017, reports flooded that the company aims to raise its value from the existing $500 Mn to $1.5 Bn through an IPO.
On the investment, Munish Varma, Partner at SoftBank Investment Advisers, said, “Over the last decade, PolicyBazaar has become synonymous with online insurance shopping in India. We believe that the Indian insurance market continues to remain massively under-developed and PolicyBazaar, supported by SoftBank’s capital and ecosystem, is uniquely positioned to dramatically increase the adoption of insurance products in the country.”
The company claims that it will grow at a CAGR of more than 80% over the next three years achieving 10 Mn transacting customers by 2020. A report by Boston Consulting Group (BCG) estimates that the digital influence on insurance purchases will grow to 50% for life insurance and 75% for general insurance by 2020.
The talks for SoftBank’s investment in PolicyBazaar began when reports surfaced that SoftBank is in talks to invest in PolicyBazaar at a valuation of $800 Mn. At the time, Yashish Dahiya, PolicyBazaar’s chief executive officer and co-founder, had said that the company has not received an offer.
He added, “The [foreign direct investment] cap will not be a challenge as we have firm offers from domestic investors with ready capital who can balance out any foreign investment.” Indian regulatory policies limit foreign domestic investment in the country at 49% and PolicyBazaar already has marquee investors, namely Tiger Global Management and Temasek Holdings, which control 48% stake in the company.
A Nasscom report has forecasted that the Indian fintech software market will touch $2.4 Bn by 2020, from the current $1.2 Bn. In its Indian Startup Funding report 2017, Inc42 Datalabs revealed that the Indian fintech industry has received $3.01 Bn across 111 deals in 2017.
The growth continued in Q1 2018, with the Indian Tech Startup Funding Q1 2018 report claiming that the fintech as a sector witnessed the highest funding.
After exiting Flipkart after the Walmart acquisition, SoftBank has been on an investment spree with plans to invest in Indian companies such as Paytm Mall, Zomato etc. With the investment of SoftBank, PolicyBazaar is ready to boost its offerings and portfolio services.