Hippo Enterprises, a US-based online home insurance provider backed by corporates Comcast, Lennar, MS&AD, Munich Re and Standard Industries, agreed to a reverse merger with special purpose acquisition company Reinvent Technology Partners Z on Thursday.
Homebuilder Lennar joined fellow existing backers Dragoneer and Ribbit Capital to co-lead a $550m private investment in public equity together with Reinvent Capital and unnamed mutual funds.
Hippo will have access to approximately $1.2bn in cash once the transaction closes, also including some $230m held in Reinvent’s trust account.
The merger is expected to close in mid-2021, subject to customary closing conditions, and Hippo will then trade on the New York Stock Exchange. The business is expected to be valued at $5bn.
Founded in 2015, Hippo uses real-time data and smart home technology to provide an end-to-end home protection and insurance platform. It has built an underwriting engine that relies on artificial intelligence to prefill applications and to assess and price risk in under a minute.
Hippo’s offering is currently available in 32 US states – the equivalent of 72% of the country’s population – and the company hopes to be available to 95% of the population by the end of this year.
Mitsui Sumitomo Insurance, a subsidiary of insurance group MS&AD, provided $350m in November 2020.
MS&AD Ventures, the investment arm of MS&AD, was later revealed to have backed a $150m series E round four months earlier together with Lennar and Propel Venture Partners, the venture capital firm sponsored by financial services firm BBVA, as well as media group Comcast’s Comcast Ventures unit.
Home maintenance services provider Standard Industries also took part in the series E round, as did Felicis Ventures, Fifth Wall, Horizons Ventures, Iconiq Capital, FinTLV, Ribbit Capital, Dragoneer, Bond, Innovius Capital, Pipeline Capital, RPM Ventures, Zeev Ventures, undisclosed hedge funds and family offices.
Bond led a $100m series D round in 2019, when Comcast Ventures, Standard Industries, Lennar, Propel Venture Partners, Felicis, Fifth Wall, Iconiq Capital, Pipeline Capital, RPM Ventures, Hillhouse Capital, Horizons Ventures, Zeev and Michael Ovitz also invested.
Lennar and Felicis co-led a $70m series C round in 2018, with participation from reinsurer Munich Re’s corporate venturing arm Munich Re Ventures and all other major existing investors.
Comcast Ventures and Fifth Wall co-led a $25m series B round earlier that same year, after Propel Ventures Propel Venture Partners, Horizons Ventures, RPM Ventures, GGV Capital and Pipeline Capital had supplied $14m in series A financing in 2016.
Hippo’s early backers also include Abstract Ventures and Aquiline Technology Growth.
