Leading flexible car insurance provider, disrupting the £16bn motor insurance market.
Business overview
| Location | London, United Kingdom |
|---|---|
| Social media | |
| Website | www.cuvva.com/ |
| Sectors | Finance & Payments Digital B2C |
| Company number | 13496602 |
| Incorporation date | 24 Feb 2014 |
Investment summary
Business highlights
- £45M GWP run rate, nearly tripling in size in the past 3 years*
- 5m+ policies, 650K+ customers & 1.1M+ vehicles insured
- Raised £15m from investors including LocalGlobe, RTP and Breega
- Excellent NPS of 75 and Trustpilot score of 4.5
Key features
Idea
Introduction
Getting car insurance on your terms is hard work. Cuvva is building the world’s most flexible and fair cover, making it effortless to share cars and insure your own.
We’re building a community of car owners and sharers. By making cars multiplayer, getting around with Cuvva has never been easier and it’s good for the planet too.
Our proprietary app helps give everyone affordable access to a car anytime, anywhere. Using world-class in-house technology we provide customers with superior products and services.
We’re best placed to support our customers because we talk to them daily. And we’re ambitious. We have to be, if we plan to overturn such an outdated industry.
*GWP run rate is an annualised figure based on April sales performance. The growth referred to is based upon total sales data 2018 Vs 2021. Figures are based on unaudited management accounts.
Substantial accomplishments to date
*based on unaudited management accounts.
Monetisation strategy
We earn revenue on each policy we sell and we intend to build additional revenue for each add-on that customers will be able to include. Subscription provides a recurring source of revenue.
Car sharing:
• We sell around 130k policies every month and our subscription product is growing. Borrow your family car, your friend’s car or your neighbour’s car. It’s now super easy to get on the road without all the upfront costs of car ownership
Subscription:
• Our newest product - designed to completely disrupt the mainstream insurance market. Car ownership isn’t annual so why should your insurance be? Tons more flexibility and you don’t pay more for paying monthly. It’s a better way to get insured
Add-ons
• Soon, we intend to grow our offering with extra add-ons, giving car owners peace of mind
Use of proceeds
Customer Growth:
• We intend to scale rapidly through new distribution channels including partnerships, plus broader content and social initiatives to expand our reach
• Invest further in digital and direct channels that perform at a highly predictable, competitive customer acquisition cost
Further investment in building Cuvva’s brand into a household name, including above the line marketing
Product / UX:
• Extend our addressable audience and enhance margins by adding features and add-ons extending the relevance of Cuvva
• Relentlessly optimise our customer experience, making it easier than ever to find and buy the right insurance
• Focus on bringing down the cost of car ownership & developing sharing tools to cultivate networks between Cuvva customers, making cars truly multiplayer
Tech:
• Further investment in the tech team to allow us to continuously go back to first principles
• Improve our Smart Pricing and telematics tool, putting customers at the heart of what we do
• Scale technical platform to support rapid growth of products, redefining how insurance should be
Investor Perks
Please note that any discounts, rewards and/or offers listed by a company in its campaign are subject to the terms and conditions applied by that company. It is the company’s responsibility to honour such discounts, rewards and/or offers and Seedrs does not take any responsibility for them.
Key Information
Valuation
The pre-money valuation for Cuvva has been calculated on a fully diluted basis, including existing rights to equity that may convert and dilute investors in the future. In this case, the valuation on the campaign reflects (i) issued shares (ii) options (iii) the outstanding convertible loan (as detailed below).
Please note that the pre-money valuation of the business when taking into account only issued share capital, is £99,973,841.85.
Fundraise details
As part of this fundraise: (i) Cuvva has secured £2.05M from existing shareholders & institutional investors; and (ii) a further allocation of at least £2M is being made available to customers & investors via Seedrs, with a third party committed to take up any unfilled portion of the Seedrs allocation on the same terms as this campaign.
The third party is connected to Seedrs, but this should not be seen as an endorsement by Seedrs or any other party; investors must, as always, make their own investment decision.
Share Classes
The company currently has 4 classes of equity shares in issue, Preferred Shares, Seed Preferred Shares, Ordinary Shares and Growth Shares.
Seedrs investors in this round will be receiving Ordinary Shares which are EIS-eligible. Existing investors who are following on in this round and certain new incoming institutional investors will be offered a choice between Ordinary and Preferred shares (which have certain preferential rights as set out below).
The rights attached to the share classes are as follows:
Preferred Shares:
- Voting rights
- Right to a dividend once declared
- 1 x non-participating preference
- Anti-dilution rights on a broad-based weighted average basis: the right to be issued additional shares at nominal value in event of a down-round
Seed Preferred Shares:
- Voting rights
- Right to a dividend once declared
- 1 x non-participating preference
- No anti-dilution rights
Ordinary Shares:
- Voting rights
- Right to a dividend once declared
- No exit or liquidation preference and no anti-dilution rights.
Growth Shares:
- No voting rights
- Entitled to share in exit and liquidation proceeds in excess of the hurdle amount that applies to the relevant Growth Share.
This means that on an exit or liquidation event, the proceeds will be distributed as follows:
1. First, holders of Preferred Shares will be entitled to the greater of (i) the amount paid for their Preferred Share and (ii) the amount they would have received had the Preferred Shares been converted to Ordinary Shares.
2. Second, holders of Seed Preferred Shares will be entitled to the greater of (i) the amount paid for their Seed Preferred Share and (ii) the amount they would have received had the Seed Preferred Shares been converted to Ordinary Shares.
3. Finally, the remaining proceeds will be distributed pro rata between holders of Ordinary Shares and Growth Shares (where the relevant hurdles have been exceeded for the Growth Shares).
Convertible Loan
The Company has outstanding convertible loan notes totalling £6,370,000 with the following key terms:
- Discount: 20%
- Interest rate: 8%
- Valuation Cap: £150,000,000
- Share class: The most senior class of shares being issued in the Financing Round.
- Maturity date: 10/09/2023.
The convertible loan notes will automatically convert if the company raises £6,370,000 in this investment round. If the company raises less than this the noteholders have the right (rather than obligation) to convert, and the company has received assurances from the noteholders that they would elect to convert their shares as part of this round.
The principal and interest of these loan notes has been factored into the pre-money calculation for the campaign. The loan notes will convert at the same time as we complete the equity funding round however interest will stop accruing on 31st May 2022.
Group Structure
Investors in this round are investing into and will become shareholders of The Cuvva Group Limited, Company Number: 13496602. This is the holding company for the group.
The holding Company has the following wholly owned subsidiary:
1. Cuvva Limited, company number 08907985
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