Rainbow, a US-based technology-powered MGU, has garnered $12m in a seed funding round.
This round saw contributions from various investors including Altai Ventures, Arch Capital Group, Buckley Ventures, Caffeinated Capital, 8VC, Habitat Partners and Zigg Capital.
Caffeinated Capital managing partner Ray Tonsing said: “We are deeply invested in Rainbow and its world-class founding team, which has accomplished so much in such a short time since inception and despite market headwinds.
“We are extremely encouraged by the early traction of their flagship programme, and their exceptional platform capabilities have them poised to scale rapidly”.
Set up in 2022, Rainbow is a specialist MGU engaged in developing tailored insurance programmes for small businesses.
The company’s engineering team has built a platform that is said to enable efficient underwriting and transaction processing for all risks submitted.
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Rainbow said it is redefining small business insurance with a focus on specific verticals where its data-driven and technological approach can provide an underwriting edge.
The company’s flagship offering is an admitted business owner’s policy product designed for the restaurant industry.
It is currently available in eight states and expected to expand to more than 25 states in 2024.
The restaurant insurance programme is distributed through independent insurance agents as well as digital partners.
Looking ahead, Rainbow aims to launch specialised programmes in additional business sectors.
Currently, Rainbow’s insurance solutions are available in Arizona, Indiana, Michigan, Ohio, Pennsylvania, Tennessee, Texas and Utah, with plans to extend to 18 more states in early 2024.
Rainbow CEO and co-founder Bobby Touran said: “Restaurants are a massive category where every operator requires insurance, and it has proven to be a challenging class for many capacity providers.
“We felt that building deep domain expertise in the verticals we focus on would allow us to use technology to tailor our underwriting and prioritise loss ratio, all while maintaining the critically important customer-centric approach to small business.”