Marshmallow, the UK insurance startup for migrants, raises $90M at a $2B+ valuation

Summary

U.K. startup Marshmallow has blown up over the years by using innovations in data science to build car insurance policies for immigrants and other consumers who have been overlooked or priced out of traditional insurance. Now, with a million drivers insured and a profitable annual revenue run rate of $500 million, Marshmallow has raised a fresh $90 million to expand. Marshmallow plans to use the funding to move into financial services, as well as more insurance products that it hopes will appeal to a population of people that — despite the chilling effects of Brexit — is growing. “We think of migration as a huge opportunity,” CEO Oliver Kent-Braham said in an interview. He noted that in the U.K., there are more people coming out of the workforce than there are going in, with 1.2 million migrants recorded coming to the U.K. in 2024 alone. “We need migration to put more people into work, and we want to help people move and integrate into the U.K.” In Marshmallow’s view, that integration comes with being able to drive your own insured vehicle and soon, the startup hopes, buying home insurance and taking out loans. Marshmallow plans to launch its first lending product later this year, Kent-Braham said, en route to building a “one-stop shop” for everything financial and insurance that a new arrival to the U.K. might need to adjust to life. This round is roughly split 50-50 between equity and debt, according to Kent-Braham, and it is coming at a valuation of just over $2 billion. To put that into context, Marshmallow last raised funding at $1.25 billion in 2021. The startup has seen considerable growth on the business front in that time. In 2021, Marshmallow had insured just 100,000 people. Now, in cities like London, the 1-million insured number is bolstered with a pink outdoor ad campaign that is hard to miss. Portage Capital is leading the round, with participation from BlackRock and Columbia Lake Partners. Previous backers of the company have included Passion Capital,...