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Should we be worried about insurtech valuations? – TechCrunch

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Hello everyone. It was a wonderful week. After experiencing heartburn that disrupts sleep, I am 32 years old. So a little better and a little worse. But it didn’t stop the market. No. Even a little. This means that there is a lot of discussion about InsurTech inventory reductions, the implications of the situation for startups, the number of IPOs, and so on. This will be fun!

Before we get to the point of chatting with the newly launched companies Kaltura, Couchbase and Enovix, let’s talk about insurtech.

I’ve seen many InsurTech startups unveiled last year or so. Including route (Automobile insurance), Metromile (Auto insurance), and lemonade (Rental insurance). Here’s an overview of today’s performance:

  • Route: $ 7.72 per share, down 71.4% from IPO price of $ 27 per share.
  • Metromile: $ 7.26 per share, down 64.4% from the combined high.
  • Lemonade: $ 86.97 per share, up 199.9% from $ 29 per share of IPO price.

Recall that Routes and Metromiles started trading after lemonade. Therefore, those reductions occur at shorter intervals rather than longer periods. It makes the situation even more interesting.

What’s wrong? Now, two of the three InsurTech public offerings (SPAC, IPO, etc.) are suddenly underwater. It’s not an incredibly good omen for hippos. Pursuing a unique SPAC-led combination It should be put together in short order. For InsurTech start-ups that have to answer questions about the value of private market investors, the big drop doesn’t seem to be bullish.

Does Lemonade’s strong post-IPO performance ease concerns? It’s tricky. The company is busy expanding into new markets, including auto insurance. The company suffered a bit of a blow from the Texas freeze earlier this year — According to the latest earnings report — But beyond these two data points, it’s not entirely clear what the company is doing that the other two aren’t. But investors are excited about lemonade, not routes or metro miles. Understanding why that’s the case and why their startups are more lemonade than the other two is key for many InsurTech startups still expanding towards their own IPOs. Probably.

IPO season

The exchange has been busy on the phone for the past two weeks, talking to the CEO of a public company and trying to learn from recent experience. Therefore, the following is a note from a phone call with people from Kaltura, Couchbase, and Enovix. pleasant!

Kaltura

  • Reminder: Kaltura focused on online video Previously submitted for publication Before this year Delay the IPO And Run again at the funding event.
  • Exchange spoke with Kaltura CEO Ron Yekutiel. He said the timing of the company’s IPO was affected by the turmoil in the public market in early 2021. It wasn’t a surprise, but I’m glad I got confirmation.
  • According to Yekutiel, the freeze was partially caused by the bombing of Archegos. That makes sense, but it was news for us.
  • Yekutiel said his company wasn’t thrilled about the delay — publishing is the only funding you announced in advance — but the investor his company has already spoken to for the first time is still Kaltura. He added that he was enthusiastic about the second run at the IPO.
  • According to the CEO, Kaltura’s Interim results for the second quarter I showed investors that what I was talking about earlier this year is coming true. He also emphasized the adoption of new products as the key to the company’s continued growth.
  • The CEO was happy with the company’s pricing and trading methods on the first day, with prices rising 20% ​​at the time of trading. He said more would have been excessive and less would have been bad.
  • Regarding Kaltura’s low price compared to the March IPO price range, Yekutiel said he had no third chance to make a first impression and his company wanted to get the offer done. So they did. Points to avoid getting lost in your head.
  • Kaltura is up 17.5% from the $ 10 IPO price per share at the time of writing.

One anecdote, if possible. Kaltura won TechCrunch40, the predecessor of the TechCrunch50 event, thanks to a one-vote vote through physical tokens. This is the predecessor of today’s TechCrunch Disrupt conference series. Yekutiel still has the token and showed it during the chat. Neat!

Couchbase

  • Exchange spoke with Matt Cain, CEO of Couchbase, a noSQL database company. Couchbase is priced at $ 24 per share, above the IPO price range of $ 20 to $ 23 per share.
  • Today’s value is $ 33.20, up 9.2% in today’s trading at the time of writing.
  • Cain was speaking from a fairly rigorous script — a fairly standard situation among newly publicized CEOs worried about shit and going to jail — the exact answer we were looking for. Could not get. But we could still learn a few things, including that Couchbase was yet another company that discovered the increased density of meetings made possible by remote roadshows.
  • The CEO focused on discussing the scale of the opportunity prior to Couchbase, the world of operational databases. He argued that it was difficult to find a larger market, which excited investors that his company might be able to achieve. What we read here is that if the market is as big as Cain expected, the database world probably has enough surface area for startups.
  • I wanted to know a little more about how public market investors see open source companies, but I didn’t know much from him. Still, the company’s IPO is very strong, and being built with OSS means that it’s not necessarily a disadvantage for companies wanting to withdraw.

Enovix

  • Since Exchange debuted via SPAC, they wanted to chat with the newly published company Enovix. Why is it important? This is because some companies have focused on other batteries that they are trying to publish via SPAC. Therefore, chat was a good background for later work.
  • And we love talking to listed companies. Who won’t do it?
  • Asked if the combination and trading day under the new ticker symbol was like an IPO for his company, Rust said it was. fair enough.
  • We noticed that the merger date of the company’s SPACs has shifted from the second quarter to the third quarter. why? In short, some SEC changes regarding accounting. The impression from the chat wasn’t a big deal, but it delayed the trading day of Enovix slightly.
  • Why publish via SPAC? Not only cash, but also a particular sponsor of those combinations, Rust said it is an important resource in terms of operational knowledge. The company also hired from a network of notable SPAC sponsors. (Hey, the added value of an actual investor!)
  • The value of his company Imminent SESSPACRust, another unprofitable battery company, said his company’s value in the SPAC deal was negotiable, and if the company succeeded, it would be worth $ 1.1 billion or $ 1.4 billion. He said it didn’t really matter. ..
  • What’s interesting about Enovix is ​​that it doesn’t start with the imminent battery technology for EVs. Instead, it is aimed at high-end electronics. why? Quick cycle and possible pricing power to incorporate the battery into the hardware. However, we plan to enter EV in time.
  • The company is worth $ 17.33 per share, indicating that Yahoo Finance describes it as a $ 2.5 billion valuation. This is a good markup from what you expected and could signal SES’s own future debut.

Yeah, that’s Many.. Thank you for sticking to me. And thank you for reading The Exchange’s small newsletter.You can catch up About all the work here If you need long-term reading on the global venture capital market, educational technology and other topics. Keep calm!

Your friend,

— — Alex



Should we be worried about insurtech valuations? – TechCrunch Source link Should we be worried about insurtech valuations? – TechCrunch

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