Startups

After 20 months of trying to raise funds, insurance startup Loop cuts staff

Comment

Carey Anne Nadeau and John Henry, the co-founders of Loop.
Image Credits: Loop

Loop, the car insurance company co-founded by Harlem Capital co-founder John Henry, has laid off staff as the company struggles with fundraising. 

Henry took to Instagram to post the email his co-founder Carey Nadeau sent to impacted staff on June 16th. Nadeu also posted the letter to LinkedIn. It stated that this was the “absolute last resort” for the company after it had been unsuccessful in raising additional capital after 20 months of trying. “Our last opportunity,” Nadeau wrote, “had an investor pull out at the very final hour, and we just fell short.” 

The email continued, saying the company decided to reduce its headcount as it seeks to operate through its financial difficulties. It’s unclear how many people were impacted. However, according to a LinkedIn post by a former employee, the cuts impacted people who were insurance agents, as well as people in customer care, data analytics, marketing, software engineering and product.

Henry did not immediately respond to our request for comment. 

Henry co-founded Loop with Nadeau in 2020 shortly after stepping down from his role as a venture partner at his firm Harlem Capital, according to his LinkedIn profile. As TechCrunch previously reported, Loop sought to serve as an alternative insurance model for pricing insurance that didn’t rely as heavily on structurally biased metrics like credit scores and education used by legacy models. 

The company launched out of stealth mode in 2021, raising a $3.25 million seed led by Freestyle VC, with participation from Backstage Capital and Uprising Ventures. Loop then went on to raise a $21 million Series A, the company said, led by Foundry Group and 01A (former Twitter CEO Dick Costolo and COO Adam Bain’s fund). In 2023 it raised an $8 million extension round, according to PitchBook.

Loop’s fundraising troubles are not unique to Black-founded companies. TechCrunch reported last year that Black founders raised less than 1% of all venture capital funding, a number that has continued to dwindle as the promises to back more Black founders made after the murder of George Floyd have diminished in recent years. 2024 continues to be a difficult fundraising year across the board. Outside of select areas, like AI, 2024 has seen some of the slowest funding rates since 2018, Crunchbase reported.

In his Instagram post, Henry wrote that the situation was “unexpected,” but the company was going to operate through it. Other Black founders rushed to empathize and express their support for Loop on Instagram.

“It’s tough out here right now,” Melissa Butler, founder of The Lip Bar, wrote. “Thank you for sharing your journey with us.” 

More TechCrunch

Google Maps is improving navigation through flyovers and narrow roads in India through new feature updates.

Google Maps adds features to improve navigating flyovers and narrow roads in India

Public market investors have a large variety of infrastructure and software that helps them keep track of, analyze and manage their investments, but that’s not the case for investors in…

bunch raises $15.5M for its platform that simplifies investment management for VCs

India’s Jio has partnered with Taiwanese semiconductor giant MediaTek to launch its 4G smart dashboards for electric two-wheelers.

Jio partners with Taiwan’s MediaTek to tap into two-wheeler EV market

A hacker claims to be selling data relating to thousands of current and former employees of India’s Piramal Group.

Hacker claims theft of Piramal Group’s employee data

CRED, an Indian fintech startup, has rolled out a new feature that will help its customers manage and gain deeper insights into their cash flow, as the startup seeks to…

CRED launches personal finance manager for India’s affluent

A powerful new video-generating AI model became widely available today — but there’s a catch: The model appears to be censoring topics deemed too politically sensitive by the government in…

A new Chinese video-generating model appears to be censoring politically sensitive topics

Our growth as a civilization is tightly coupled to our ability to sufficiently generate ever-increasing amounts of electricity. Could the same be true in space?  Star Catcher Industries, a startup…

Star Catcher wants to build a space power grid to supercharge orbital industry

For frontier AI models, when it rains, it pours. Mistral released a fresh new flagship model on Wednesday, Large 2, which it claims to be on par with the latest…

Mistral’s Large 2 is its answer to Meta and OpenAI’s latest models

Researchers at MIT CSAIL this week are showcasing a new method for training home robots in simulation.

Researchers are training home robots in simulations based on iPhone scans

Apple announced on Wednesday that Apple Maps is now available on the web via a public beta, which means you can now access the service directly from your browser. The…

Apple Maps launches on the web to challenge Google Maps

AltStore, an alternative app store, has launched its first batch of third-party iOS apps in the European Union. The rollout comes a few months after the company launched an updated…

Alternative app store AltStore PAL adds third-party iOS apps in wake of EU Apple ruling

Microsoft this afternoon previewed its answer to Google’s AI-powered search experiences: Bing generative search. Available for only a “small percentage” of users at the moment, Bing generative search, underpinned by…

Bing previews its answer to Google’s AI Overviews

Hiya, folks, welcome to TechCrunch’s regular AI newsletter. Last Sunday, President Joe Biden announced that he no longer plans to seek reelection, instead offering his “full endorsement” of VP Kamala…

This Week in AI: How Kamala Harris might regulate AI

But the fate of many generative AI businesses — even the best-funded ones — looks murky.

VCs are still pouring billions into generative AI startups

Thousands of stories have been written about former NFL quarterback and civil rights activist Colin Kaepernick. If anyone knows a thing or two about losing control of your own narrative,…

Colin Kaepernick lost control of his story. Now he wants to help creators own theirs

Several people who received the CrowdStrike offer found that the gift card didn’t work, while others got an error saying the voucher had been canceled.

CrowdStrike offers a $10 apology gift card to say sorry for outage

TikTok Lite, a low-bandwidth version of the video platform popular across Africa, Asia and Latin America, is exposing users to harmful content because of its lack of safety features compared…

TikTok Lite exposes users to harmful content, say Mozilla researchers

If the models continue eating each other’s data, perhaps without even knowing it, they’ll progressively get weirder and dumber until they collapse.

‘Model collapse’: Scientists warn against letting AI eat its own tail

Astranis has fully funded its next-generation satellite program, called Omega, after closing its $200 million Series D round, the company said Wednesday.  “This next satellite is really the milestone into…

Astranis is set to build Omega constellation after $200M Series D

Reworkd’s founders went viral on GitHub last year with AgentGPT, a free tool to build AI agents that acquired more than 100,000 daily users in a week. This earned them…

After AgentGPT’s success, Reworkd pivots to web-scraping AI agents

We’re so excited to announce that we’ve added a dedicated AI Stage presented by Google Cloud to TechCrunch Disrupt 2024. It joins Fintech, SaaS and Space as the other industry-focused…

Announcing the agenda for the AI Stage at TechCrunch Disrupt 2024

The firm has numerous legs to it, ranging from a venture studio to standard funds, where it does everything from co-founding companies to deploying capital.

CityRock launches second fund to back founders from diverse backgrounds

Since launching xAI last year, Elon Musk has been using X as a sandbox to test some of the Grok model’s AI capabilities. Beyond the basic chatbot, X uses the…

X launches underwhelming Grok-powered ‘More About This Account’ feature

Lakera, a Swiss startup that’s building technology to protect generative AI applications from malicious prompts and other threats, has raised $20 million in a Series A round led by European…

Lakera, which protects enterprises from LLM vulnerabilities, raises $20M

Alongside a slew of announcements for Play — such as AI-powered app comparisons and a feature that bundles similar apps — Google has introduced new “Curated Spaces,” hubs dedicated to…

Google Play gets ‘Comics’ feature for manga readers in Japan

Farmers have got to do something about pests. But nobody really likes the idea of using more chemical pesticides. Thomas Laurent’s company, Micropep, thinks the answer might already be in…

Micropep taps tiny proteins to make pesticides safer

Play Store is getting AI-powered app comparisons, automatically organized categories for similar apps, dedicated hubs for content, data personalization controls, support for playing multiple mobile games on PCs, and more…

Google adds AI-powered comparisons, collections and more data controls to Play Store

Vanta, a trust management platform that helps businesses automate much of their security and compliance processes, today announced that it has raised a $150 million Series C funding round led…

Vanta raises $150M Series C, now valued at $2.45B

The Overture Maps Foundation is today releasing data sets for 2.3B building “footprints” globally, 54M notable places of interest, a visual overlay of “boundaries,” and land and water features such…

Backed by Microsoft, AWS and Meta, the Overture Maps Foundation launches its first open map datasets

The startup is not disclosing its valuation, but sources close to the company say the figure is just under $400 million post-money.

Dazz snaps up $50M for AI-based, automated cloud security remediation