Wefox secures USD 55 million

Deutsche Bank and Unicredit are providing Wefox with a further USD 55 million. According to a report on CNBC, the investment is structured as a convertible loan, which will be converted into equity in the next financing round.

Shortly after publication, Wefox CEO Julian Teicke confirmed the news in a LinkedIn post. In the text, he emphasises that the necessary rapid transition to profitability is not easy for the insurtech company: «Leading our company from a period of hypergrowth to one of profitable growth in a short span is a complex challenge. It compelled us to make hard choices and to step back from several innovative projects close to my heart. Despite these tough decisions, the dedication to adapt to the realities of the market was crucial. The investment is a significant affirmation from the industry and a clear nod to the path we've chosen toward profitable growth.”

In 2022, Wefox had managed to quadruple its premium income compared to the previous year, but in doing so, the loss had also increased. Losses also resulted from the brokerage business. 2023 will be characterised by the transformation into a profitable company. Among other things, an experienced CFO has been brought on board and activities in some insurance segments have been scaled back.

Investors support this move. Wefox had already announced an investment of USD 110 million in May 2023, which consisted of a USD 55m credit facility from J.P. Morgan and Barclays alongside a $55m second close in its Series D.

(Stefan Kyora)