Root, a mobile-based auto insurer, filed on Monday with the SEC to raise up to $100 million in an initial public offering. However, this is likely a placeholder for a deal we estimate could raise up to $800 million.
Root believes that it can challenge the traditional insurance model by using technology to measure risk based on individual performance. The company utilizes a mobile-first engagement strategy, providing a user-friendly interface for customers' mobile phones.
Another insurance tech company, online renters and homeowners insurance provider Lemonade (LMND) is currently up 86% from its July IPO.
The Columbus, OH-based company was founded in 2015 and booked $432 million in revenue for the 12 months ended June 30, 2020. It plans to list on the Nasdaq under the symbol ROOT. Root filed confidentially on August 10, 2020. Goldman Sachs, Morgan Stanley, Barclays, Wells Fargo Securities, Credit Suisse, Deutsche Bank, Evercore ISI and Truist Securities are joint bookrunners on the deal. No pricing terms were disclosed.
