India (Commonwealth Union)_ At a time when other investors are exercising caution about investment options, General Atlantic plans to increase its bet on an Indian insurtech company, as the firm is in discussions to invest around $50 million in Acko General Insurance, according to sources familiar with the subject. The sources have revealed that the growth equity investor based in New York is preparing to lead a new $100 million fundraising round for the Indian business.
One of the sources stated that the fresh round, which is anticipated to be funded almost exclusively by existing investors, will likely proceed at a valuation of $1.2 billion to $1.25 billion. Some sources warn that the conditions of the agreement are subject to change as the investment has not closed yet. However, Acko, which secured a fundraising round headed by General Atlantic and became a unicorn last year, and the investment company refused to comment on this.
According to sources, the latest discussions follow Acko’s prior engagement with PayU to raise over $200 million at a valuation of $1.8 billion. However, it is unclear why such negotiations broke down. Some Indian media reports stated that PayU had extended a term sheet to Acko. Acko, whose current investors include Lightspeed Venture Partners India, CPPIB, Amazon, and Multiples Private Equity, is among the few firms seeking to transform the country’s outmoded insurance market with a digital-first solution.
The firm also develops and distributes auto insurance products, targeting drivers and others involved in transportation-related sectors, healthcare coverage for companies and protection for electronic devices. The company has also partnered with a number of firms; Amazon, an existing investment in Acko, is one of the startup’s distribution partners, as are MakeMyTrip, Ola, Bajaj Finance, and Urban Company, among others. Acko stated a year ago that its agreements with firms, such as food delivery titans Swiggy and Zomato, cover roughly one million gig workers in the country.
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