Jay-Z, Will Smith, Kevin Durant-Backed Life Insurance Startup Ethos Raises $35M In Sector Ripe For Disruption

Jay-Z, Will Smith, Kevin Durant-Backed Life Insurance Startup Ethos Raises $35M In Sector Ripe For Disruption

Listen to GHOGH with Jamarlin Martin | Episode 08: Marlon Nichols

Jamarlin talks with Marlon Nichols, co-founder of Cross Culture Ventures, about the culturally-themed fund he started with Troy Carter.


Ethos, a life insurance startup that says it can process applications in 10 minutes, has raised $35 million in a new funding round with backing from Arrive, Jay-Z’s Roc Nation investment company.

A relative unknown in Silicon Valley, Ethos has attracted some big-name investors including Kevin Durant. It was just June when the company raised $11.5 million in its Series A — the first major round of investment, led by Sequoia Capital, CNBC reported. The round also included Will Smith’s firm, Smith Family Circle.

As consumers grow increasingly comfortable with shopping online, life insurance distribution, in particular, is ripe for disruption, according to Benefits Pro.

In other words, some of Silicon Valley’s most respected investors see big potential in the arcane and boring world of life insurance, not to mention the celebrity crowd already drawn to the opportunity.” — San Francisco Business Times.

The Series B funding round was led by Accel, an early and growth-stage venture capital firm with backing from Sequoia Capital, Jay-Z, Hollywood entertainers Will Smith and Robert Downey Junior, GV (Google’s venture capital arm) and Stanford University.


life insuranceEthos uses data analytics to predict a person’s life expectancy and says it can cut the time it usually takes to apply for life insurance policies from 10 weeks to 10 minutes. It says that insurance claims are paid out “within weeks” and that 99 percent of customers don’t need a medical exam or blood test to get a policy.

This model targets people in their prime who might not think about applying for life insurance, according to CNBC.

Ethos offers a new way to sell an old product to a generation that’s intolerant of traditional insurance salesmen and the hours of paperwork involved, Tech Crunch reported.

life insurance
Jay-Z performs on the 4:44 Tour at Barclays Center on Sunday, Nov. 26, 2017, in Brooklyn, New York. (Photo by Scott Roth/Invision/AP)


Insurance startups have raised billions of dollars and have seen multiple exits as insurers try to defend against incumbents. Many insurance companies have set up their own funds to invest in new technologies before they get disrupted, Tech Crunch reported.

Instead of selling permanent life insurance (which payers opt out of, or allow to lapse), Ethos offers a form of life insurance that allows policyholders to pay for a fixed period.

Accel partner Nate Niparko will join the Ethos board of directors and GV General Partner Tyson Clark will become an advisor to the company’s board.

The new round of financing brings Ethos’ total funding to more than $46 million. It will help the company in its mission to transform the $955 billion life insurance market into a more modern, digitally-driven industry, the company said in a press release.

“Ethos is proving that life insurance is something that can be bought by consumers, and not sold,” said, Peter Colis, CEO and co-founder of Ethos.

While the U.S. economy, job market, and population continue to grow, life insurance policies sold in the U.S. are declining, Black Enterprise reported. The share of Americans with life insurance has fallen from 77 percent in 1989 to less than 60 percent.

Ethos’ policies are underwritten by Assurity Life Insurance.