Slingshot Insurance Raises $27M Seed Round To Target Checkout Insurance

Slingshot Insurance, a Minneapolis-based AI-native embedded insurance startup, emerged from stealth with $27 million in seed funding. Rally Ventures and Skyward Group co-led the round, with participation from insurance industry veterans including Jim Hays, who will join Slingshot’s board.

The company is led by co-founder and CEO Ethan Genteman and is focused on small insurance policies offered alongside another purchase, such as coverage during a flight booking. Rally is also a co-founder of the startup, consistent with its broader approach to building some portfolio companies from the ground up.

Slingshot is targeting the operational friction behind low-cost insurance products. Small policies can require paperwork, coordination with insurers and claims support, which can make them difficult to administer profitably.

The startup’s software connects businesses that distribute policies with insurers that back the coverage. Slingshot says it uses AI to process and share data between the two sides, with the goal of reducing manual work tied to spreadsheets, emails and disconnected systems.

Slingshot’s first customer and design partner is Vertical Insure, which serves more than 750,000 customers at an average premium of $25, according to Slingshot. Genteman told Crunchbase News that Slingshot’s first program will launch this month.

Vertical Insure’s experience helped shape the startup’s direction. The company had opportunities to introduce more insurance products but struggled to find insurers whose technology and processes could keep pace, according to the article.

Slingshot sees an opening among vertical SaaS companies, which already handle industry-specific transactions and customer data. The thesis: those platforms can add insurance naturally at checkout or within an existing customer experience.

Examples cited by Genteman include youth sports coverage, replacement childcare coverage, pet boarding coverage and equipment rental protection. Slingshot aims to help these companies move from product idea to operational insurance offering while navigating industry and regulatory requirements.

For now, Slingshot earns revenue as a technology provider working with outside insurers and charges a 5% technology fee to administer programs through its platform. The six-person company is also pursuing an acquisition that would allow it to back policies itself.

That carrier move is the key next milestone. If completed, Slingshot would seek to combine software, insurance backing and operational infrastructure for embedded insurance programs in one business.