Rainbow, a digitally-enabled managing general underwriter (MGU) building tailored small business insurance products, announced it raised $8 million in Series A funding, led by Zigg Capital.

The funding, which closed in Q4 2024, will accelerate the company’s plans to expand its specialized underwriting approach to additional business verticals. Rainbow’s second program was recently launched in select states, followed by a nationwide rollout.

This funding brings Rainbow’s total capital raised to $20 million since the company was formed in 2022. Led by an experienced team of entrepreneurs, Rainbow has developed a platform to address the small commercial insurance industry and demonstrated exceptional traction with its initial product, an admitted business owner’s policy (BOP) designed specifically for the restaurant industry.

This insurance program is currently live in 24 states, and it will see expansion into additional states, including New York, over the coming months. And Rainbow’s specialized risk selection approach, supported by its proprietary continuous underwriting in-house risk monitoring software, is a workbench that enables the company to address the unique risks faced by small businesses in challenging industry niches.

Rainbow’s technology platform provides agents and brokers with a seamless quote-to-bind experience while rewarding policyholders for prudent operational practices. And the company’s data-driven continuous underwriting framework enables real-time portfolio assessment, improving underwriting accuracy and decreasing loss ratios.

KEY QUOTES:

“As we continue to prove our thesis for scalable, software-driven-underwriting across a growing portfolio of specialized insurance programs, we’re thrilled to be deepening our partnership with Zigg, a firm that shares our vision for a differentiated approach to profitable insurance underwriting with endless potential. This new capital will allow us to accelerate our expansion into additional verticals in service of growing demand from our agent and distribution partners, all while continuing to innovate our proprietary technology and attracting the best talent to our team.”

• Bobby Touran, CEO and Co-founder of Rainbow

“As our firm refined its broad insurtech thesis, we identified that Rainbow has built the most compelling technology platform to serve the restaurant vertical, as well as the SME sector. Moreover, the team Bobby, Shalom, and Jamie have assembled at Rainbow exemplifies the profile Zigg seeks to back – efficient, fast moving, domain expert, and customer centric. Rainbow’s custom-built software to serve its various constituencies is powerful and the company’s growth is among the fastest we have observed for a B2B offering.”

• Ryan Orley, General Partner of Zigg Capital