Now a unicorn, a Miami insurtech raises $180M round, led by Oaktree Capital
To accelerate development of its AI platform and rapidly scale, Healthcare.com today announced it has raised a large injection of investor capital, joining the unicorns of Miami.
The insurtech company, based in Miami and New York, has closed a $180 million financing round on a valuation of over $1 billion, said Healthcare.com co-founder Jose Vargas. This oversubscribed round included $130 million in Senior Non-Convertible Preferred and more than $50 million of Series C Preferred equity and was led by Oaktree Capital Management. Existing investors Axis Capital and Second Alpha participated in the financing, as did founders.
Founded in 2014, HealthCare.com leverages machine learning and artificial intelligence to match consumers of all life stages with personalized health plans and associated products, including pharmacy plans and its own proprietary insurance plans.
In the last year, the company has helped 5.6 million people find and buy a healthcare product.
“The consumer is always the center of what we do and we’re just getting started,” said Don Loonam, CEO of Healthcare.com, in an interview with Refresh Miami. “We built a platform where consumers can discover, choose and buy… We built the hub, and now where we go next is to double down on our mission to make it easier and faster and more transparent for consumers.”
Technology including AI should play a huge role in transforming the legacy insurance industry, said Loonam, who joined Healthcare.com as CEO last February and previously was COO of startup Assurance IQ, sold to Prudential in a multi-billion dollar deal. “We are looking to create intelligence that services the consumer in some of the most critical decisions of their lives.”
With this new funding round, HealthCare.com plans to accelerate its investment in data science, product development, and engineering, as well as scale up hiring. Previously the company raised $34.5 million, according to Crunchbase. Healthcare.com joins the South Florida club of so-called unicorns, privately held companies valued at over $1 billion that includes Papa, Pipe, REEF Technology, Magic Leap, Modernizing Medicine, Kaseya, Insightec and Memic.
“HealthCare.com is changing consumer behavior by disrupting the U.S. healthcare markets, creating new products and efficiencies with the objective of empowering consumers. Oaktree is excited to partner with the HealthCare.com team to continue scaling the company in its next phase of growth., ” said OakTree Capital Managing Director Brian Laibow, in a statement. Laibow and Linda Ventresca, Chief Strategy Officer for AXIS Capital, have joined the board of directors.
Healthcare.com is coming off a year of explosive growth. All segments of the market grew strongly, including the 25-35 age group, and the over 65 market (about a quarter of its customer base) grew 1,000% year over year, Loonam said. In addition to a talented team and strong technology, he said, “it doesn’t hurt that we have the world’s greatest url.”
To meet the demand, the team has grown from about 100 to 425 employees in a year, Loonam said. The team is distributed around the US as well as Guatemala, Thailand and the Netherlands. The original co-founders of HealthCare.com, including Vargas, Jeff Smedsrud and Howard Yeh, remain active in senior leadership roles within the company.
About a dozen employees are in South Florida, but Loonam expects significant growth in Miami and the company has begun scouting for more office space. About 60 team members gathered in Miami last week, and Loonam said some may be making plans to relocate. “Miami itself is a great recruiter.”
Healthcare.com is hiring. Globally, Loonam said he expects to add about 1,000 employees, including engineers, data scientists, product development, sales and marketing, over the next year. “Our mission has helped us attract the best and the brightest,” he said. “We’re trying to make lives better.”
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