The insurtech start-up which specialises in providing insurance to gig economy workers has secured £6m from Balderton Capital.
Pay-as-you go insurance provider Zego has raised £6m in series A funding from Balderton Capital, as the start-up gets ready to launch new products for flexible workers employed in the sharing economy.
The Clerkenwell-based firm, which has grown from seven to 33 employees since the start of 2017, has also raised funding from original investor LocalGlobe and from angel investors from the insurance sector.
Zego, which was launched by former Deliveroo managers last year, will use the funding to hire more specialists for its engineering team, as well as staff to build key business functions.
It is on the verge of launching a suite of insurance products for self-employed people, including those working in the so-called gig economy. It is also looking to expand internationally over the next six months.
Zego is moving fast to fill the gap created by platform businesses such as Deliveroo, Quipup, Uber and Uber Eats, which do not consider their workers to be employed.
Platform businesses have been under scrutiny following a series of employment tribunals and court cases which have questioned the nature of the relationship between the platforms and people who work with them.
At present Zego provides specialist pay-as-you-go insurance to delivery drivers using cars and scooters for food delivery.
In 2018, Zego is focused on delivering a range of additional benefits to support the self-employed worker, along with alternative vehicle products.
Harry Franks, chief executive at Zego, said: “Zego provides hardworking drivers with the tools to make gig economy jobs work for them.
“Before we came along drivers who wanted to work flexibly and part-time were ill-served by the insurance industry and were forced to pay for insurance cover they did not use.
“We’re delighted that Balderton wants to work with us as we develop pay-as-you-go policies for the fast-growing numbers of self-employed and sharing economy workers.”
Rob Moffat, partner at Balderton Capital, added: "At Balderton we have been looking in depth at tech companies in insurance over the last few years.
“Zego really stood out with their innovative insurance products solving a major problem for drivers. They are in a new and fast evolving market that traditional insurers find it hard to adapt to.
“We were blown away by the execution speed of Harry, Sten, Stu and team and their ambitious plan to offer a wider suite of insurance products that resolve many of the problems gig economy workers face."
Zego was founded by three tech entrepreneurs with first-hand experience of crowd-sourced companies. Before starting Zego, Harry Franks worked at Deliveroo and before that luxury rental business onefinestay, which was sold to AccorHotels last year.
Sten Saar, co-founder and chief operating officer, started his first company at the age of 17 growing it to a net revenue of US$1m. He later worked for onefinestay and latterly developed operations at Deliveroo, while it was growing rapidly.
Stuart Kelly, co-founder and chief technology officer was lead developer at Mainframe and then head of engineering at successful start-up Hubble, where he was responsible for developing the technology to create a scalable global platform.