Next Insurance raises $250m in a round led by FinTLV Ventures and Battery Ventures. Credit: Nattanan Kanchanaprat from Pixabay

Small business-focused insurtech Next Insurance has received $250m in additional funding, which takes its valuation to $4bn.

The financing round was led by FinTLV Ventures and Battery Ventures. They were joined by CapitalG, Group 11, Zeev Ventures, Founders Circle and G Squared.

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As part of the transaction, FinTLV Ventures founder and managing partner Gil Arazi along with Battery Ventures general partner Michael Brown will become board observers.

With the fresh funds, the firm’s total capital raised until now comes to $881m.

Next Insurance co-founder and CEO Guy Goldstein said: “This latest round of financing is a validation of our vision which is to make it dramatically easier for small business owners to get the insurance coverage they need by removing friction from the customer experience.

“It starts with developing a comprehensive digital product portfolio under one roof, continues with leveraging technology that improves the customer experience, and ends with a network of integrated partnerships that bring policy purchasing to the customer within the systems they already use.”

Palo Alto-based Next Insurance, set up in 2016, leverages artificial intelligence (AI) technology and machine learning to simplify the purchasing process.

The company claims that its technology-driven approach reduces costs by up to 30% compared to traditional policies.

The firm has been in the news recently for its partnership with Amazon Business to offer customised small business insurance to eligible members.

Also, last month, the insurtech signed a definitive agreement to acquire digital insurance agency AP Intego.

In December 2020, Next Insurance acquired Juniper Labs – that offers alternative open data and underwriting technology for small businesses. The deal marked Next Insurance’s first acquisition.

Next Insurance further said that it has been on a growth trajectory last year, when it increased customers holding more than one policy by ten times and hiring180 new employees.

Arazi stated: “Next Insurance’s full-stack approach to providing coverage for small businesses has created a radical paradigm shift in the legacy insurance industry.

“This value proposition, combined with a differentiated focus on machine learning and growing an innovative product portfolio has created unstoppable momentum that is undoubtedly changing how small businesses shop and purchase insurance.”