Digital insurance aggregator Coverfox has received Rs 30 crore fresh infusion from parent Glitterbug Technologies. The proceeds would be likely to streamline things at the company that has been going through the ordeal in the past couple of months.
Coverfox board has appointed Sanjib Kumar Jha, co-founder of private equity firm Avaana Capital as the interim chief executive officer last month. According to regulatory filings, it has approved a private placement offer dated March 13 to approve allotment of 15,864 equity shares at a share price of Rs 18,910.8 across five tranches.
It’s worth noting that the company’s co-founder and CTO Devendra Rane and its CEO Premanshu Singh had resigned from the company in February. Entrackr had exclusively reported about aggravating woes for Coverfox in detail in February.
According to the valuation report filed by the company on January 16, Coverfox values its equity at Rs 1733.3 crore.
Coverfox used to be the second-largest player in insurance aggregation space. Despite raising $47 million in risk capital from investors including SAIF, Accel and Transamerica and Catamaran, it has been left far behind when compared to its deep-pocketed rival PolicyBazaar.
On the other hand, newbies like Turtlemint grew at a quick pace and grabbed more market share, leaving Coverfox trailing.
The company’s new CEO Jha is a co-founder of private equity fund Avana Capital, which is an existing investor at Coverfox. It will be interesting to see how he leverages his experience to turnaround the company.
Over the past six-eight months, Coverfox has been looking out for a possible acquisition. However, its talks with Paytm, Policybazaar and others didn’t move for some unknown reasons.
Varun Dua and Rane founded Coverfox in 2013, but Dua moved away eventually to start Acko General Insurance in 2016.