- Cachet, an Estonian startup that offers an insurance marketplace for gig workers, has raised $5.7 million.
- The company offers “data-led pricing” by aggregating workers’ data across gig platforms.
- Cachet plans to spend the fresh funds on expanding its services across Europe.
Estonia-based startup Cachet aggregates gig workers’ data to offer personalized insurance coverage based on hours worked across multiple apps.
The startup has raised $5.7 million (€5.5 million) in a seed/Series A round led by venture capital firm Truffle Capital. The fresh funds bring its total raised to $7.26 million (€7 million). Venture capital firms Uniqa Ventures and Icebreaker.vc also joined the round.
The marketplace offers insurance plans for gig workers at a rate it says is 47% cheaper on average than standard insurance plans. It covers independent contractors working concurrently for Uber, Bolt, Deliveroo, and TaskRabbit, among others.
The idea behind Cachet is to offer insurance plans that accurately represent gig workers’ hours and activity, without requiring that they work solely for one company. “Platform workers are not loyal to only one platform. So if we take whatever area, whether it’s ride hailing or its delivery, they work at least two, if not more platforms at the same time,” cofounder Hedi Mardisoo said.
Cachet currently has operations in Estonia, Latvia and Poland, and is eyeing the Nordic states as their next market for expansion, according to Mardisoo.
Meanwhile, the EU is deliberating around a current regulation gap for gig workers. The European Commission’s platform workers directive, introduced in December, would mark a radical shift in Europe’s gig economy. If passed, the onus would be on tech companies to prove that a worker is not an employee and therefore not eligible to benefits like insurance.
Insurance options in the Cachet marketplace stem from at least 12 insurance underwriters and includes third-party liability, motor and micro-mobility insurance, and personal health and accident coverage.
Cachet was founded in late 2018 by Mardisoo, ex-head of corporate affairs at banking group Swedbank, and Kalle Palling, an ex-member of the Estonian Parliament. Palling, who was first elected to Parliament in 2007 at the age of 22, served as chairman of the Parliament’s European Union Affairs Committee.
While in Parliament, Palling was the architect of policy measures that regulated ride sharing that put into place standardized licensing and quality processes for private-hire drivers and taxi drivers alike. However, the question of insurance for Uber drivers, like for gig workers at other tech companies that don’t offer insurance directly to contracted workers, was not resolved.
“Everything was perfect for the platforms, meaning that they were allowed to operate by the books. But then the only option for the driver was to buy full time taxi insurance,” Palling said.
Cachet has ambitious plans for 2022, including a tripling of its workforce by the end of the year. It’s hiring for roles including chief insurance officer, country manager, expansion manager, and content marketer.
Check out the 13-slide pitch deck Cachet used to raise $5.7 million in its latest round.