Lula, a Miami-based insurance infrastructure firm, has announced a $18 million Series A investment round SoftBank’s SB Opportunity Fund, hedge fund manager Bill Ackman, Shrug Capital, Steve Pagliuca (Bain Capital co-chairman and Boston Celtics owner), and Tiny Capital’s Andrew Wilkinson were among the investors in the round, which was co-led by Founders Fund and Khosla Ventures.
- The App: Michael and Matthew Vega-Sanz, 25-year-old twin brothers and Miami residents founded Lula as a spin-off from another firm they began in college. By September 2018, they had officially released the app outside of the Babson College campus, where they were studying on a scholarship. According to the brothers, the app became one of the top apps on Apple’s App Store within eight days of its introduction.
- Past life: “We couldn’t afford to have a car on campus and wanted pizza one night,” Michael recalls. “So I thought it would be cool if there was an app that let me rent a car from another student, and then I thought ‘Why don’t we build it?’ We then built the ugliest app you’ve ever seen, but it allowed us to rent cars from other people on the campus.” It was the first company to allow 18-year-olds to rent cars without restrictions, according to the company.
- Infrastructure: As the firm developed, it began forming partnerships with auto rental companies to boost its vehicle supply. The brothers quickly discovered that the insurance infrastructure they’d put into their service was the most appealing element of it.
- Integrated suite: Through its insurance partners, Lula now provides a “fully integrated suite” of technology-enabled features such as consumer screening, fraud detection, driver history checks, policy administration, and claims processing. It has a roughly 2,000-company waiting list and has increased its funding to meet that demand.
- Smart decision: “The main purpose of raising capital was so we can build out the team necessary to fulfill demand and sustain growth moving forward,” Matthew said. “And apart from that, we also just want to further develop the technology — whether it be in the ways that we’re collecting data so we can get more granular and make smarter decisions or just optimizing our vetting system. We’re also just working toward developing a much more robust API.”