when Cover pagethat offers commercial insurance products for startups, tripled the number of integrated distribution partners to over 100 in the past year, CEO Ralph Betesh had a decision to make.
It could either continue to move toward profitability or raise a round of venture capital — which the commercial insurance provider didn’t really need — so it could integrate the larger partners faster.
“More big partners kept coming in and closing with us, pushing to get on our roadmap,” Betesh told TechCrunch. “We discussed slowly adding these partners, but we thought we might lose them. On the other hand, everyone told us that this might be the most challenging environment for a Series A in four years.”
Additionally, it wasn’t too long ago that Coverdash raised funds. TechCrunch last profiled the company in early 2023, when it raised $2.5 million in seed funding. At the time, the company was newly launched with 35 distribution partners.
Betesh founded the company with David Vainer and Avery Rubin in 2022. Coverdash offers small businesses, e-commerce merchants and freelancers the ability to purchase business insurance in areas such as business owner policies, cyber and indemnity employees.
Distribution partners such as payroll providers, banks and vertical SaaS platforms are integrating Coverdash’s insurance tool into their platforms. Businesses then answer a few questions, select a policy and receive coverage within minutes.
“Our goal was to bring the embedded customer, or direct consumer, options from the biggest names in the insurance industry and let you choose what’s best for you,” Betesh said. “This approach also insulates us from some of the carrier-specific nuances. For example, if a carrier doesn’t take the risk, we have a number of other options for you that enable us to offer you better pricing and better coverage for that price. That’s really powerful for the end customer we’re focused on.”
Last year, Coverdash added a stewardship liability product aimed specifically at startups that either have a board of directors or are raising capital. This comes with certain requirements, such as liability insurance for the company’s board directors and officers and other executives, Betesh explained.
This new product has resulted in some large businesses coming Coverdash’s way, including new partners and growth across the board. From quintupling its workforce to tripling its integrated distribution partnerships to 30% month-over-month customer growth. Betesh did not get specific on revenue other than to say it grew “exponentially” over the past year as a result of partnership and client growth.
Ultimately, Betesh and his co-founders opted to go the venture capital route, raising $13.5 million in Series A funding. New investor Nyca Partners led the round and joined existing investors including Bling Capital, AXIS Digital Ventures, Tokio Marine Future Fund, Expansion VC and Cameron Ventures.
“We were ready for it,” Betesh said. “Everything happened very quickly and in over two weeks we had offers from several companies. We were really lucky. What helped us was the partnerships and what we were able to deliver in such a short period of time, as well as our focus on being profitable as soon as possible.”
