Root, the parent company of digital car insurance platform Root Insurance, launched its initial public offering and its shares exceeded expectations.
The company reportedly raised $663.7m during the IPO, which is priced above its marketed range, according to a report from the Financial Times. It claims that Root had initially pegged to sell its shares between $22 and $25 apiece; however, it actually sold 22 million of its shares for $27 each.
Its shares had increased by 4% at lunchtime on the day of launch, according to the FT.
This sale has valued Root at $6.7bn. The company’s previous valuation was $3.65bn, which it cemented after a $523m Series E in August 2019.
An additional 2.6 million shares were sold by the company’s existing shareholders, it said.
Root Insurance, which was founded in 2015, uses a driver’s smartphone to determine how well they drive and then use the data to determine a personalised insurance price. Through the mobile app, a user can purchase and manage their policy and claims.
Last year, the company launched its renters insurance policy to help people in the US protect their valuables.
Root is not the first US InsurTech to launch an IPO this year. Lemonade recently launched publicly with shares priced at $29; however, prices skyrocketed to $50.06 during the day. The sale saw Lemonade reach a $3bn market cap.
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