Root Insurance Co has hired Goldman Sachs to lead preparations for its initial public offering, according to a Reuters report.
The IPO could value the company, which provides auto insurance through mobile apps, at around $6 billion, Reuters reported.
The IPO will make Root the latest of several tech-powered insurance companies to go public. In May, comparison website SelectQuote raised $360 million in its IPO. In July, insurance provider Lemonade raised $319 million. The IPOs valued the companies at $3.25 billion and $1.6 billion, respectively, according to Reuters.
Root is aiming for a valuation of $5 billion to $6 billion, sources told the newswire. The company’s stock market debut could come later this year or early in 2021.
Founded in 2015, Root began by offering car insurance. It uses a smartphone-administered driving test and an algorithm to offer a quote that it says is fairer than data used by traditional insurers. Last year, the company also began offering renters insurance.
Root’s previous funding round, announced in August 2019, valued the company at $3.65 billion.
