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Kudo Insurance

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Kudo is a revolutionary motor insurer founded by Peter Graham, insurance veteran and former CEO of esure

0%
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Funded 27 Sep 2022
£650,000 target
£889,340 from 0 investors
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Business overview

Location London, United Kingdom
Social media
Website www.kudoinsurance.com
Sectors Finance & Payments Digital B2C
Company number 10368531
Incorporation date 9 Sep 2016
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Investment summary

Type Equity
Valuation (pre-money) £8M
Equity offered 7.53%
Share price £10
Tax relief

EIS

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Business highlights

  • Highly experienced Insurance team
  • Gamified safe driver score & industry leading engagement platform
  • Machine Learning Pricing Model (Strong tech and IP)
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Key features

  • Secondary Market
  • Seedrs nominee min. £10.00 +
  • Direct investment min. £4,900.00 +
  • Idea
  • Key Information
  • Team
  • Updates
  • Investors 0
  • Discussion
  • Documents

Idea

Introduction

Kudo is a revolutionary motor insurer with a game changing driver score and industry leading engagement programme that rewards safer drivers and builds a path to hopefully become profitable.

Founded by Peter Graham, insurance veteran & former CEO of esure, Kudo is for the millions of safe drivers in the UK & rewards them for driving safely & with consideration to other road users.

The Kudo Story:

As one of the original insurance disruptors in his role as CEO of esure, Peter Graham had closely monitored innovation that could transform motor insurance profitability. Kudo was born out of the emergence of mobile telemetry that facilitated the cost-effective identification of better drivers - without the need to sell motor insurance policies as a pre-requisite.

Kudo’s beta version of the App was developed to test the hypothesis and trials were carried out with three UK insurers (AXA, RSA and esure Insurance), and consumers. The detailed trial with esure Insurance proved the level of driver score required (700 out of 1,000) to differentiate the better drivers (reduced frequency of motor insurance claims), and consumers also stated a good driver score would be a good way to prove their value to insurers. Peter managed to attract a team of likeminded insurance leaders and functional experts and Kudo’s path to full-market deployment followed with the company now ready to build scale of App Users and generate car insurance revenue.

How it works:

Market Opportunity:

The UK private motor insurance market (c30m vehicles and a £16.4bn annual market premium) is broken. Insurers have a weak relationship with consumers, focused on price and a once in a year purchase window.

Substantial accomplishments to date

Kudo Timeline:

Monetisation strategy

Kudo plans to attract a customer base through cost effective strategic partnership with relevant road safety, price comparison website and Tier 1 Auto OEM partners to mitigate Direct to Consumer risks.

Use of proceeds

We will also be investing in adding new talent to our already deeply experienced team so we can deliver even more.

Your investment will fuel our quest to reward safe drivers and make Britain's road safer, all while working toward our mission of building the most profitable motor insurer in Britain.

Key Information

FCA Regulatory Approval

Kudo Insurance (Toggle Data Services Limited) is a company registered in the UK, with a registered office at 49 Greek Street, London, England, W1D 4EG, company number 10368531. Toggle Data Services Limited is not authorised by the Financial Conduct Authority (FCA).

Kudo MGA Limited (13392723) is a wholly owned subsidiary of Toggle Data Services Limited. Kudo MGA Limited has been approved as an Appointed Representative, acting on behalf of its principal Blagrove Underwriting Agency Limited (04209302). As an Authorised Representative of Blagrove Underwriting Agency Limited, Kudo MGA Limited will be fully approved to sell insurance policies once two Kudo MGA Limited team members have had their Approved Persons applications approved. Both team members have been approved persons with a number of insurers in the past.

Please note that Kudo MGA Limited is currently party to a FCA related reportable event. Kudo MGA Limited sold one policy when the company should have held its own regulatory status as an Appointed Representative (AR) of Blagrove. When Blagrove identified this error, policy quotes and sales were immediately switched off within the Kudo App. Given the policy was sold under Blagrove’s insurance arrangements it is a requirement of Blagrove to report the sale of the policy to the FCA, and explain why Kudo MGA Limited did not have the correct permission at the time of the policy sale.

Convertible Loan Note

The company has an outstanding secured convertible loan, which may convert to equity after this round and dilute existing shareholders (the ‘CLN’). The terms of the convertible loan are as follows:

- Loan value: £500,000
- Lender: XS Direct
- Security: Fixed and floating charge over all the Company’s assets
- Interest rate: 12% p.a.
- Conversion:
(i) Conversion trigger: Equity raise of not less than £1,000,000 in aggregate, if XS Direct elects to convert
(ii) Conversion price: 40% discount on share price of the equity raise
(iii) Share class: The same share class as issued in the trigger round
- Repayment:
(i) Repayment date: December 2023, if not already paid / converted
(ii) The CLN shall also be repayable on either a default of the CLN or change of control in the Company

Share Classes

The company currently has four classes of shares: A Ordinary, B Ordinary, C Ordinary and Ordinary (for employee options), which each have equal rights to voting, dividends and distributions of capital.

All investors in this round, including Seedrs investors, will be receiving C Ordinary shares.

Company Structure

Investors in this round are investing into and will become shareholders of Toggle Data Services Limited. This is the holding company of Kudo MGA Limited.

Outstanding Invoice:

During the early development of Kudo, the Company used a service provider to develop the proof of concept for the mobile application. As part of that agreement the Company prepaid for ‘service credits’ and the contract also provided for further payments by the Company. These services were ceased in 2019. There remains a service credit which the Company does not believe that it will use nor will it recover the costs. At the time, the Company ceased its relationship with this provider an invoice was issued for further service credits to the amount of $190.000. The service provider has not requested payment and has subsequently been acquired. For good accounting practice the Company holds the amount as a “payable” in its accounts and intends to do so for a period of six years from 2018.

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Investing involves risks, including loss of capital, illiquidity, lack of dividends and dilution, and should be done only as part of a diversified portfolio. Please read the Risk Warnings before investing. Investments should only be made by investors who understand these risks. Tax treatment depends on individual circumstances and is subject to change in future.

This webpage has been approved as a financial promotion by Seedrs Limited ("Seedrs"), which is authorised and regulated by the Financial Conduct Authority. It is not intended to be a promotion of any individual investment opportunity and is not an offer to the public. The summary information provided about investment opportunities on this webpage is intended solely to demonstrate the types of investments available on the Seedrs platform, and any investment decision should be made on the basis of the full campaign. Full campaigns are available to investors who have become authorised to invest on the Seedrs platform. All investment activities take place within the United Kingdom, and any person resident outside the United Kingdom should ensure that they are not subject to any local regulations before investing.

Seedrs does not make investment recommendations to you. No communications from Seedrs, through this website or any other medium, should be construed as an investment recommendation. Further, nothing on this website shall be considered an offer to sell, or a solicitation of an offer to buy, any security to any person in any jurisdiction to whom or in which such offer, solicitation or sale is unlawful. Seedrs does not provide legal, financial or tax advice of any kind. If you have any questions with respect to legal, financial or tax matters relevant to your interactions with Seedrs, you should consult a professional adviser.

Tax Relief (SEIS)

This business is eligible for SEIS relief - providing qualifying investors with income tax relief of 50% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Tax Relief (EIS)

This business is eligible for EIS relief - providing qualifying investors with income tax relief of 30% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Valuation (pre-money)

Valuation rounded from £7,986,440

This is the fully-diluted pre-money valuation of the business (i.e. before the new investment comes in and including issued options and other equity interests). In contrast, the post-money valuation is based on inclusion of the new investment in the value.

It is calculated as the pre-money valuation plus the amount of new investment. e.g. If Company A is ascribed a pre-money valuation of £1,200,000 by prospective investors investing £300,000, its post-money valuation is £1,500,000.

Pitch type

There are 5 types of investment pitch available on Seedrs.

  • Equity
  • Convertible
  • Fund
  • Cohort
  • Secondary

Investing in a regular equity campaign is the simplest and most common way to invest in a startup. You decide which business you want to invest in, and if the campaign hits its funding target then you will become one of their shareholders. As the company becomes more valuable, so do your shares; allowing you the opportunity to share in the future success of the business.

Learn more about pitch type on Seedrs

Equity Offered

The equity offered is the percentage of the company’s shares being issued in return for the amount of investment raised.

When the amount raised is less than 100%, the equity offered is based on the target raise. Once the company has raised over 100% it is based on the total raised.

In some scenarios, entrepreneurs may accept additional direct investment after closing their Seedrs campaign. Provided this is within 6 months of the closing and on the same terms, we do not typically offer pre-emption rights on that extra investment (where you have the opportunity to invest again to maintain your percentage shareholding).

Learn more about investing and pre-emption rights.

Seedrs nominee

This shows if you are able to choose, when making an investment, that you be represented by, and your shareholding be managed by, the Seedrs nominee.

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Custodian

If you invest in this Campaign, Seedrs will act as Custodian rather than provide our standard nominee service. This is due to the fact that the business is not directly involved in the share sale and Seedrs will not benefit from any rights under a shareholder agreement. As a result, Seedrs will handle administrative tasks as we do normally, but you will not have information or voting rights, updates from the business, preemption on future fundraising, or ongoing support about business trading activity.

Learn more about Custodian here

Secondary market

This shows if the business has opted-in or opted-out of allowing its shares to be bought and sold on the secondary market.

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Direct investment

This is an option to invest and hold shares 'directly' in the company (rather than via the Seedrs Nominee). This option is only available to those investing over the threshold amount, which is determined by the fundraising company.

If you choose to hold your shares directly, you will be responsible for any contractual or administrative arrangements with the company you are investing in.

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Payment options

We are not able to accept card payments for investments into this sector. You can pay for your investment by creating a bank transfer, using funds in your investment account or create a Pay by Bank payment. Your investment will only be completed once the funds have reached our account.

Business Involvement

This Campaign offers shares for sale in business that is not directly involved in this Campaign or the sale. As a result, the Campaign and post-investment experience, including investor rights, will differ from a business-led campaign on Seedrs. Most notably, the business will not engage with investors in the discussion forums both during and after the sale or provide any updates to investors.

Learn more here

Payment options

We are not able to accept Pay by Bank payments for investments into this sector. You can pay for your investment with a card payment, by creating a bank transfer or by using funds in your investment account. Your investment will only be completed once the funds have reached our account.

Drawdowns

This campaign offers the ability to pay for an investment by drawdowns.

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None of the information in constitutes part of the campaign and it has not been approved or reviewed by Seedrs.

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