Chinese insurtech platform Yuanbao has secured nearly 1 billion yuan ($155.9 million) in a Series C round of financing led by Source Code Capital, which invests in early- and growth-stage tech companies in China, the startup announced on Monday.
Cathay Capital alongside existing shareholders Beijing-based HIKE Capital, Northern Light Venture Capital, Qiming Venture Partners and US-based Susquehanna International Group participated in the round.
Thriving Capital, a Beijing-based investment bank, served as the exclusive financial advisor of the deal.
The Series C round is the fourth investment completed by Yuanbao although the startup initiated its operations only a year back. The new financing came shortly after Waterdrop, a Tencent-backed Chinese insurtech firm, raised $360 million in an initial public offering (IPO) in New York on May 7.
Only about 200 million people in China have purchased insurance products online while statistics from the China Internet Network Information Centre (CNNIC) recorded a population of 989 million netizens by the end of 2020. That put the penetration rate of Chinese people using Internet at 70.4%, while the percentage was much higher when it comes to mobile Internet users, at 99.7% last year.
Yuanbao was established by Fang Rui, ex-vice president at Chinese tech firm NetEase where he helped create the firm’s online payment and e-commerce departments. The Beijing-based firm, which officially started operations in 2020, has attracted a few million paying users across major regions in China.
It partners with domestic insurers like Huaxia Life Insurance, China Life Insurance, Taikang Life Insurance, Sunshine Insurance Group, and People’s Insurance Company of China (PICC), per its website.
As a licensed insurance broker in mainland China, Yuanbao leverages big data and artificial intelligence (AI) to help consumers identify insurance products that meet their demands. It also offers one-stop services such as health management, insurance consultancy, and intelligent underwriting, while aiding in the settling of claims.
The startup will use new proceeds to fund the R&D of core technologies and to accelerate its speed of building smart insurance services. In the long run, Yuanbao targets to build an integrated “health plus insurance plus medical care” platform that can bridge health management and medical care through commercial insurance offerings.