Laka has successfully raised $4.7 million in equity funding.
The round was led by early-stage venture capital firms LocalGlobe and Creandum. The round closed on 30th January 2019.
Participation also comes from Yes VC, the venture fund founded by Caterina Fake, co-founder of Flickr and Jyri Engeström, co-founder of Jaiku and Ditto, and angel investors including Nick Evans, chairman of cycling apparel firm Rapha, and Oren Peleg, the former CEO of Fitness First. Following on from Laka’s pre-seed round in June 2018, this round brings the total amount raised to date to $6.4 million.
The funding will be used to fuel Laka’s upcoming launch in the Netherlands in H1 2020, which it will use as a springboard to roll out its product across Europe and beyond. Laka will be using the funds to further develop its product set, which will include personal accident cover tailored to the cycling community. This will be focused on health, recovery and wellness, allowing cyclists that have experienced injury or accident to quickly find the medical support that they need.
Headquartered in London, and launched in January 2018, Laka is initially focused on the cycling market, and its first product ensures bicycles and cycling equipment against theft or damage. Laka has grown quickly, with a ten-fold increase in insured value over the course of 2019. Its products are now used by over 5,000 cyclists across the UK.
Unlike the traditional actuarial model of insurance, Laka customers work together as a community and share the cost of claims. Laka handles all claims, divides the cost fairly and limits each customer’s maximum monthly spend with a cap based on the value of the equipment insured by each individual member.
All of Laka’s insurance policies are backed by Zurich, and all of its claims team, most of which are ex-cycling mechanics, are based in-house.
Tobi Taupitz, CEO of Laka, said: “Cyclists should be able to completely trust their insurance providers – through our community-based approach, we are bringing our customers, many of whom have previously been ill-served by legacy players, a product that ensures fair treatment, trustability and transparency.
“We’ve seen a fantastic response from the British cycling community, who have become our greatest advocates, and we’re looking forward to launching Laka across Europe and beyond.
“The applicability of this model is really exciting. Ideally suited to high frequency and low severity forms of insurance, our ultimate ambition is to roll out Laka insurance products for a range of different purposes. From covering the equipment of the 138 million outdoor sports enthusiasts across Europe, to personal accident cover and beyond, our mission to create a community-driven, transparent approach to insurance has only just begun.”