Failed 2024
Lemonade
AI-powered insurance sounds disruptive but insurance is a regulated, low-margin business where incumbents have decades of data.
Founded → Closed
2015 → 2024
Funding Raised
$480M
Industry
InsurTech
Country
USA
IdeaProof AI Failure Score
62/100
Market Fit Risk
50
Burn Rate Risk
75
Founder Risk
25
Full Analysis
Lemonade disrupted renters and home insurance with AI-powered claims processing and a social impact model. IPO'd at $3.8B in 2020. But the company's loss ratio remained stubbornly high — Lemonade paid out more in claims than it collected in premiums. The stock crashed 90%+ from its peak. While technically still operating, Lemonade has failed to achieve profitability and its market cap has shrunk dramatically.
Could This Failure Have Been Prevented?
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