US-based insurtech start-up Federato, which offers an AI-powered RiskOps platform, has secured $40m in its Series C funding round, led by Stepstone Group.
Existing investors Emergence Capital, Caffeinated Capital and Pear VC also contributed to this round.
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The latest infusion brings Federato’s total funding to $80m.
StepStone Group partner John Avirett said: “We have been closely following Federato’s rapid growth over the past five years as an LP [limited partner] in several organisations who have been investors in the company since inception. Founders Will and William’s deep expertise in AI and their dedication to bringing a true vertical AI product to the insurance industry is impressive. Federato’s fast-growing customer base is a testament to the impact they have already delivered.
Last year, Federato raised $25m in Series B funding, with Caffeinated Capital leading the round.
Both Emergence Capital and Pear VC participated in this round.
The Series A round in 2022, led by Emergence Capital, helped rake in $15m. This round saw participation from Caffeinated Capital, Pear VC, AgentSync co-founder and CEO Niranjan Sabharwal, and Guidewire co-founder and former CEO John Raguin.
The RiskOps platform developed by Federato introduces an AI-first approach, streamlining the underwriting process.
Once a submission arrives in an underwriter’s email or portal, RiskOps activates its AI capabilities, prioritising high-appetite business, providing instant portfolio feedback and merging various workflows into one efficient system.
Customers of Federato have reported enhancements in operational efficiency, including a 90% increase in quote speed, a threefold rise in the proportion of business bound and a 50–90% reduction in the number of systems underwriters need to use.
