Laka, a London, UK-based community-driven insurance technology company, raised $4.7m in equity funding.
The round – which brings the total amount raised to date to $6.4 million – was led by early-stage venture capital firms LocalGlobe and Creandum with participation from Yes VC, Jyri Engeström, and angel investors including Nick Evans, and Oren Peleg.
The company intends to use the funds to accelerate the upcoming launch in the Netherlands in H1 2020, which it will use as a springboard to roll out its product across Europe and beyond, to further develop its product set, which will include personal accident cover tailored to the cycling community.
Founded by Tobi Taupitz (CEO), Jens Hartwig (CPO) and Ben Allen (CTO), Laka has developed a community-driven approach to insurance initially focused on the cycling market. Its first product insures bicycles and cycling equipment against theft or damage. Its products are now used by over 5,000 cyclists across the UK. Unlike the traditional actuarial model of insurance, which incentivises the insurer to maximise profit by settling as few claims as possible, Laka customers work together as a community and share the cost of claims.
The company handles all claims, divides the cost fairly and limits each customer’s maximum monthly spend with a cap based on the value of the equipment insured by each individual member.
All of Laka’s insurance policies are backed by Zurich, and all of its claims team, most of which are ex-cycling mechanics, are based in-house.