Marshmallow Raises US$90m to Scale Migrant Insurance Model

Marshmallow, a UK-based insurtech that specialises in motor insurance for people who have relocated to the UK, has raised US$90m in a funding round that values the company at US$2bn. 

The investment combines equity and debt financing from Portage, BlackRock and Columbia Lake Partners.

The capital injection comes three years after Marshmallow's Series B round, with the company nearly doubling its valuation during this period. 

The funds will be deployed to expand the product range and support international market entry plans.

The company's growth metrics demonstrate market validation of its underwriting approach, with over one million drivers now insured and a turnover run rate exceeding US$500m. 

This scale positions Marshmallow among the largest insurtechs in the European market.

Risk model innovation challenges traditional pricing

Marshmallow was established to address systematic pricing disparities that affect newcomers to the UK, who typically face higher insurance premiums compared with native-born residents. 

The company has developed an alternative risk assessment framework that leverages its proprietary technology stack and customer data to price risk more accurately for this segment.

This approach has allowed the company to better serve a customer segment that traditionally faces higher premiums in the UK insurance market.

Following this investment, Marshmallow intends to apply its data-driven underwriting capabilities beyond motor insurance to address additional protection gaps for migrant populations. 

The insurtech aims to create an integrated insurance platform specifically designed for people who have moved to the UK.

Cross-border expansion strategy

The funding will support Marshmallow's plans to extend its underwriting approach to international markets. The company intends to apply its risk modelling expertise to serve newcomer populations in countries beyond the UK, targeting what may be a globally underserved risk pool.

Oliver Kent-Braham, Co-CEO and Co-Founder of Marshmallow, says: “Our ambition is to become a one-stop-financial-shop for newcomers so they feel as though it's easy to move to, and live in, a different country. 

“We've already supported over one million people in the UK with their insurance needs, but we're only just scratching the surface. There are still major financial services barriers that make it harder for newcomers to settle and take part in everyday life. 

“This funding gives us the capital to solve these problems and deliver against our mission.”

Founded in 2017 by twins Alexander and Oliver Kent-Braham, alongside software engineer David Goaté, Marshmallow has built an operation with 700 employees across London and Budapest.

The company achieved unicorn status in 2021 and was recognised by The Financial Times as the second-fastest growing company in Europe in 2023.

Marshmallow’s focus on migrant insurance markets addresses a segment that has historically faced challenges accessing financial services. 

With increasing global mobility, there is growing demand for insurance products designed specifically for people who relocate to new countries.

Devon Kirk, General Partner & Co-Head, Portage Capital Solutions, concludes: “Marshmallow is a clear leader in innovating to solve important financial challenges for consumers. 

“We are confident in the business's ability to continue developing solutions for a fairer financial ecosystem, and we are excited to support this strong team as it enters its next stage of growth.”

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