Car insurance InsurTech Marshmallow has hit a valuation of $1.25 billion after raising $83 million in a Series B funding round.

Marshmallow claim they are the second black-founded FinTech in the UK to reach “unicorn” status with a valuation of over $1 billion.

The London-based firm, founded in 2017 by twins Oliver and Alexander Kent-Braham, uses AI algorithms to provide car insurance policies aimed at immigrants, expats and people travelling to the UK.

Investors in the round included Passion Capital, Investec Bank, and Scor.

Capital from the funding round will be used to expand the brand across Europe according to Marshmallow and to grow its motor insurance market share in the UK.

The news comes after Marshmallow raised $30 million in a Series A funding round in November 2020.

Marshmallow claims to have grown over 100 per cent in the last six months and to have sold over 100,000 policies to date.

“Customers are voting with their feet - and they clearly want a modern insurance offering,” said Oliver Kent-Braham, co-founder and chief executive of Marshmallow. “We’ve only just scratched the surface of disrupting a market worth $5 trillion globally, and there’s so much more we’re planning to do in the coming years.”

He added: “We look forward to building more products that help people in their time of need.”

“Marshmallow’s unicorn status highlights yet another tech success story of 2021, hot on the heels of the UK reaching 100 tech unicorns,” said Gerard Grech, chief executive at UK technology industry body Tech Nation. “Marshmallow - having previously joined Tech Nation’s Future Fifty programme - is an excellent example of what can be achieved when given the right tools and networks to thrive, but we must continue to level the playing field for excellent Black founders to scale to their fullest potential.”

He added: “The UK’s tech sector is going from strength to strength, with innovative entrepreneurs such as Oliver and Alexander Kent-Braham cementing our place on the world stage.”

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