US-based online insurance portal Oscar Health secured $165m yesterday in a round featuring two subsidiaries of internet and technology conglomerate Alphabet: Capital G and Verily Life Sciences.
Venture capital firm Founders Fund led the round, which included financial services group Fidelity, 8VC, General Catalyst, Khosla Ventures, Thrive Capital and undisclosed others. It valued Oscar at $3.2bn, sources familiar with the matter told CNBC.
Oscar runs an app-based platform where users or businesses can buy health insurance which comes with features such as the ability to speak to a doctor online, manage prescriptions and access local physicians.
The company’s growth strategy involves tying up partnerships with local health systems and entering four or five cities a year. It operates in the states of California, Ohio, New Jersey, New York, Texas and Tennessee, and expects to generate more than $1bn in gross premium revenue this year, it said in a statement.
Oscar has now received more than $935m in funding since it was founded in 2012. Its last round involved it raising $400m in early 2016 from investors including CapitalG, Alphabet’s growth equity unit, and Ping An Ventures, the strategic investment arm of insurance firm Ping An.
The 2016 round, which valued Oscar at $2.7bn, was led by Fidelity Investments and also featured General Catalyst, Founders Fund, Lakestar, Khosla Ventures and Thrive Capital.
CapitalG invested $32.5m in Oscar in 2015 at a $1.75bn valuation, and the company’s earlier backers include investment banking firm Goldman-Sachs, Founders Fund, 8VC, Khosla, Thrive Capital, Horizon Ventures and Wellington Management.