SA’s Pineapple wins R22.5m in US startup competition, reveals new funding round

Johannesburg-based insurtech startup Pineapple has won first prize and $1.5-million (R22-million) in VentureClash, a $5-million global venture challenge for early-stage companies, run by US-based Connecticut Innovations.

This, as the startup also revealed that it had carried out a funding round of over R5-million earlier this year.

In a live pitch event at Yale University on 17 October in front of a panel of judges, Pineapple beat nine other startups — three from the US, four from Israel and two from Canada — to come out top.

The 10 finalists were selected from over 300 vetted applicants. The news follows Pineapple’s selection in September as one of the 10 finalists (see this story).

Pineapple won first prize and $1.5-million in VentureClash following a live pitching event earlier this month

There were several prizes given out by venture capital (VC) fund Connecticut Innovations, from a total prize pool of $5-million.

Pineapple was founded in 2017 by Matthew Elan Smith, Ndabenhle Junior Ngulube and Marnus van Heerden. The startup’s app allows users to insure anything from cellphones to bicycles in the snap of a picture.

‘Close to securing US partnership’

Commenting in a call to Ventureburn today, Elan Smith said he and his co-founders would likely use the prize money to fund the development startup’s motor insurance product, which it planned to launch in the next six months.

In addition, some of the funds could go to helping the startup to further explore the US market. The startup, he said, is in “late-stage” discussions with a US partner.

Elan Smith had been based in Hartford, Connecticut for a number of months, while the startup was part of the Hartford InsurTech Hub (see this story). The cohort has since come to an end.

‘Asisa ESD Fund round was above R5m’

Elan Smith also confirmed that earlier this year the startup took a bridging round of funding from the Association for Savings and Investment SA (Asisa) Enterprise Supplier Development (ESD) Fund.

The fund, which is managed by Edge Growth, mentions the investment in its April-June 2019 quarterly report (opens as a PDF).

Reads the report: “Since launching in July 2018, Pineapple has seen more than 13 000 members join the platform, converting many to active policies in the home-content items space.

It said the trust’s investment will enable Pineapple to expand its team, develop the business further and cater for growth and working capital needs including technology and operational enhancements.

Elan Smith declined to disclose how much the round was for, but confirmed that it was higher than the R5.2-million in seed funding the startup secured from Lireas Holdings, the strategic investment arm of Hannover-Re Group Africa, in 2017 (see this story).

Asisa investment principle Alex Rodrigues also declined to reveal the amount the startup got in funding, but pointed out that it one of the fund’s rules is that any single investment can’t be higher than 10% of the entire assets under management by the fund — which currently totals R450-million.

Elan Smith said the startup currently has 12 employees and is looking to make about three more hires by the first quarter of next year.

Pineapple is underwritten by Compass Insure.

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Featured image: Pineapple co-founders Ndabenhle Ngulube, Marnus van Heerden and Matthew Elan Smith (Supplied)