Private Equity Firm General Atlantic Seeks to Increase Stake in Amazon-Backed Insurtech Startup Acko

Indian Insurtech Startup Eyes New Financing Round Amid Global Economic Uncertainty

In a move that reflects its confidence in the Indian insurtech market, General Atlantic is reportedly in talks to invest about $50 million in Acko, a unicorn startup that offers bite-sized insurance policies to individuals and businesses. According to sources familiar with the matter, the New York-headquartered growth equity investor is positioning itself to lead a new financing round of around $100 million in the Indian startup.

A Valuation of $1.2 Billion to $1.25 Billion

The investment, which has not yet been finalized, is expected to come at a valuation of $1.2 billion to $1.25 billion, nearly flat from Acko’s previous valuation of $1.8 billion. The new round is likely to be largely financed by existing backers, with General Atlantic playing a key role in leading the investment.

Acko’s Journey to Unicorn Status

Acko became a unicorn last year after securing a funding round led by General Atlantic. The startup has since become one of the most prominent players in India’s insurtech space, developing and selling bite-sized auto insurance products, healthcare protections to employers, and protection on gadgets.

Why Acko is Important in India

Acko’s focus on providing affordable insurance policies to individuals and businesses is crucial in a country where only a fraction of the population currently has access to insurance. With an average Indian making around $2,100 per year, according to the World Bank, offering bite-sized insurance policies that are within reach of the masses is essential.

Insurance Penetration in India

According to rating agency ICRA, insurance products had reached less than 3% of the population as of 2017. With such a low penetration rate, Acko’s efforts to provide affordable and accessible insurance solutions are vital to bridging this gap.

Dealing Flow Activity Hits Rock Bottom

The new funding deliberations come at a time when deal flow activity has taken a severe hit in the South Asian market. Indian startups raised $3 billion in the quarter that ended in September, down 57% from the previous quarter and 80% year-over-year, according to market intelligence platform Tracxn.

Acko’s Distribution Partners

Acko has established distribution partnerships with several prominent companies, including Amazon, which is an existing investor in Acko. The startup also partners with travel and hotel booking platform MakeMyTrip, ride-hailing firm Ola, insurance giant Bajaj Finance, and Urban Company.

Bite-Sized Insurance Policies

Acko’s bite-sized insurance policies are designed to cater to the needs of individuals and businesses, offering flexible and affordable protection options. The startup has already made significant inroads into the market, covering nearly a million gig workers in India through partnerships with companies such as Swiggy and Zomato.

General Atlantic’s Bet on Acko

General Atlantic’s investment in Acko reflects its confidence in the Indian insurtech space. By doubling down on its bet on the startup, General Atlantic is demonstrating its commitment to supporting innovation in the country’s rapidly growing insurance sector.

A New Financing Round

The new financing round, which is expected to be led by General Atlantic, will provide Acko with additional capital to continue expanding its operations and improving its products. With the investment, Acko will be well-positioned to take on the challenges of India’s antiquated insurance industry.

Conclusion

General Atlantic’s investment in Acko marks a significant development in the Indian insurtech space. The startup’s focus on providing affordable and accessible insurance solutions has resonated with investors, who are eager to support innovation in this rapidly growing sector. With General Atlantic at the helm, Acko is poised to make even greater strides in the market, bridging the gap between insurance penetration and demand.

About Acko

Acko is an Indian insurtech startup that offers bite-sized insurance policies to individuals and businesses. Founded in 2019, the startup has quickly established itself as one of the leading players in the country’s rapidly growing insurance sector.

About General Atlantic

General Atlantic is a New York-headquartered growth equity investor that focuses on supporting innovation in the technology, healthcare, and consumer sectors. With investments across the globe, General Atlantic has a proven track record of backing successful startups and entrepreneurs.

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