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$LMND – Lemonade insurance, MEGA THREAD! 
One of the longer ones, but we will come around the company, numbers, bull/bear-case, 2021 expectations, products, etc.
Always apricate a comment, retweet, and dialogue about these threads
Hope you are ready
One of the longer ones, but we will come around the company, numbers, bull/bear-case, 2021 expectations, products, etc.
Always apricate a comment, retweet, and dialogue about these threads
Hope you are ready
1/x What they do
”Lemonade Insurance Company is transforming the very business model of insurance… Unlike any other insurance company, we gain nothing by delaying or denying claims (we take a flat fee!), so we handle and pay as many claims instantly as possible.”
”Lemonade Insurance Company is transforming the very business model of insurance… Unlike any other insurance company, we gain nothing by delaying or denying claims (we take a flat fee!), so we handle and pay as many claims instantly as possible.”
2/x The company
4 years old
Hyper-scaleup
Not profitable
Using AI is their biggest advantage
+1M customers
They have 0 debt
+300 employees
+50 job openings atm
90 seconds to sign up
down to 3 seconds to get paid for a claim (avg. 1 day)
How they do:
4 years oldHyper-scaleup Not profitable Using AI is their biggest advantage +1M customers They have 0 debt+300 employees +50 job openings atm90 seconds to sign up down to 3 seconds to get paid for a claim (avg. 1 day) How they do:
3/x Funding
Lemonade Inc. is backed by investors including:
- Aleph
- General Catalyst
- GV (formerly Google Ventures)
- Sequoia Capital
- Thrive Capital
- SoftBank (biggest investor today, 21,18%)
The total money raised by the company to $480 million before IPO
Lemonade Inc. is backed by investors including:
- Aleph
- General Catalyst
- GV (formerly Google Ventures)
- Sequoia Capital
- Thrive Capital
- SoftBank (biggest investor today, 21,18%)
The total money raised by the company to $480 million before IPO
4/x Data
- 87% of their customers are first-time policyholders
- 75% are younger than 34 years of age
- Biggest age group are 25-34 years with 63%
- 23,5% female / 76,5% male
- Customers Per human are outstanding
- Their prices are on average 68% cheaper than their competitors
- 87% of their customers are first-time policyholders
- 75% are younger than 34 years of age
- Biggest age group are 25-34 years with 63%
- 23,5% female / 76,5% male
- Customers Per human are outstanding
- Their prices are on average 68% cheaper than their competitors
5/x The industry
5 trillion dollar industry worldwide
No one in the market has more than a 4% market share
Traditional and old companies lead the industry; the average age of their competitors is 125 years
12 of the fortune 500 companies are insurance companies
5 trillion dollar industry worldwide No one in the market has more than a 4% market share Traditional and old companies lead the industry; the average age of their competitors is 125 years 12 of the fortune 500 companies are insurance companies
6/x Customers 
Lemonade has earned 4.9 stars in the App Store and on Google Play and is also top-rated by Supermoney, Clearsurance, and others. One of the few insurances which can brag about this.
And looking at the picture, it sure looks like the customers love Lemonade!
Lemonade has earned 4.9 stars in the App Store and on Google Play and is also top-rated by Supermoney, Clearsurance, and others. One of the few insurances which can brag about this.
And looking at the picture, it sure looks like the customers love Lemonade!
7/x The data structure 
Lemonade delivers insurance policies and handles claims through desktop and mobile apps using chatbots and AI.
Datapoints > Refinement > More accurate claims > Cheaper insurance > Delighting customers > More data datapoints > Circle again.
Lemonade delivers insurance policies and handles claims through desktop and mobile apps using chatbots and AI.
Datapoints > Refinement > More accurate claims > Cheaper insurance > Delighting customers > More data datapoints > Circle again.
8/x Numbers 
- Premiums worth $188M in Q3, which is +99% upside YoY
- Gross profit increased 83% YoY
- Adjusted gross profit grew 138% YoY
- Gross loss ratio fell from 87% to 72%
Rapid growth: grew its customer base by 46% in the first nine months of 2020 and 108% in 2019
- Premiums worth $188M in Q3, which is +99% upside YoY
- Gross profit increased 83% YoY
- Adjusted gross profit grew 138% YoY
- Gross loss ratio fell from 87% to 72%
Rapid growth: grew its customer base by 46% in the first nine months of 2020 and 108% in 2019
9/x Numbers
Premium per customer, defined as in force premium divided by the number of customers, was $201 at the end of the third quarter, up 19% from the third quarter of 2019, which show upsell is going very well and can be further improved with more products
Premium per customer, defined as in force premium divided by the number of customers, was $201 at the end of the third quarter, up 19% from the third quarter of 2019, which show upsell is going very well and can be further improved with more products
10/x Product line
Renters insurance
Pet insurance
Home insurance
Liability insurance
Life Insurance (coming very soon)
Not access for all countries on all of these*
Get upsell opportunities and still huge TAM on new product lines.
Renters insurancePet insurance Home insuranceLiability insurance Life Insurance (coming very soon)Not access for all countries on all of these*
Get upsell opportunities and still huge TAM on new product lines.
11/x 2021 x Countries
- Looking to expand into new countries
- Probably 2M customers when 2021 are done
- Looking to expand product lines (there is a lot of buzz around car insurance)
Countries they have launched: US (but not all US), France, Germany, and the Netherlands
- Looking to expand into new countries
- Probably 2M customers when 2021 are done
- Looking to expand product lines (there is a lot of buzz around car insurance)
Countries they have launched: US (but not all US), France, Germany, and the Netherlands
12/x Countries coming
Austria, Belgium, Bulgaria, Croatia, Czech Republic, Denmark, Estonia, Finland, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Norway, Poland, Portugal, Cyprus, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, and United Kingdom.
Austria, Belgium, Bulgaria, Croatia, Czech Republic, Denmark, Estonia, Finland, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Norway, Poland, Portugal, Cyprus, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, and United Kingdom.
13/x News flow
Offering 3M shares to the public market (insider stockholders will sell another 1,5M). It will be for “general corporate purposes”. It will probably be the same as $SE and $TSLA did. They finance their growth through their raising stock price instead of debt.
Offering 3M shares to the public market (insider stockholders will sell another 1,5M). It will be for “general corporate purposes”. It will probably be the same as $SE and $TSLA did. They finance their growth through their raising stock price instead of debt.
14/x News flow
Lemonade won a case against @deutschetelekom in France, where the $DTE had trademarked the color pink. The ruling was on December 15, 2020. Own view: This is badass winner-mentality. I love the approach. https://www.businesswire.com/news/home/20201216005880/en/%C2%A0Lemonade-Wins-FreeThePink-Case-Against-Deutsche-Telekom-in-France
Lemonade won a case against @deutschetelekom in France, where the $DTE had trademarked the color pink. The ruling was on December 15, 2020. Own view: This is badass winner-mentality. I love the approach. https://www.businesswire.com/news/home/20201216005880/en/%C2%A0Lemonade-Wins-FreeThePink-Case-Against-Deutsche-Telekom-in-France
15/x Small thing
When CEO, Daniel Schreiber, gets interviewed, he is very focused on telling the story about becoming an “ironic company in the 21century”, it really gives a feeling about the vision. Own view: He knows he can become the most acknowledged leader in insurance
When CEO, Daniel Schreiber, gets interviewed, he is very focused on telling the story about becoming an “ironic company in the 21century”, it really gives a feeling about the vision. Own view: He knows he can become the most acknowledged leader in insurance
16/x Glassdoor reviews
The Trustpilot for employees, Glassdoor, where Lemonade has one of the best profiles I have seen. 97% of the reviews will recommend a job at Lemonade to their friends, and 99% will give the CEO thumbs up. Based on 147 reviews. https://www.glassdoor.com/Reviews/Lemonade-Reviews-E1736285.htm
The Trustpilot for employees, Glassdoor, where Lemonade has one of the best profiles I have seen. 97% of the reviews will recommend a job at Lemonade to their friends, and 99% will give the CEO thumbs up. Based on 147 reviews. https://www.glassdoor.com/Reviews/Lemonade-Reviews-E1736285.htm
17/x The management team
Directors and executive officers owned 36,9% of the outstanding shares (after the new offering, the number will be 36,5%). CEO Daniel Schriber owns 15M shares. They have skin in the game, no doubt.
PS: Love the management team. Very strong team!
Directors and executive officers owned 36,9% of the outstanding shares (after the new offering, the number will be 36,5%). CEO Daniel Schriber owns 15M shares. They have skin in the game, no doubt.
PS: Love the management team. Very strong team!
18/x AI
It sounds to everyone that the whole company only do AI and chatbots. But it was actually “only” 8% in 2018, and in 2020 it was 33% (5x, so still pretty!). But it is still a misunderstanding in the market, that the whole dialogue with the customers solely based on AI.
It sounds to everyone that the whole company only do AI and chatbots. But it was actually “only” 8% in 2018, and in 2020 it was 33% (5x, so still pretty!). But it is still a misunderstanding in the market, that the whole dialogue with the customers solely based on AI.
19/x The bull
Disruption: Being disrupter in a sector which needs it. They think costumer before they think insurance.
Value: They know how to make use of their USP. They have no reason for denying or delaying claims. Lemonade takes a fixed fee, so the structure is different.
Disruption: Being disrupter in a sector which needs it. They think costumer before they think insurance.
Value: They know how to make use of their USP. They have no reason for denying or delaying claims. Lemonade takes a fixed fee, so the structure is different.
20/x The bull
Brand: Their brand is something else. They are not afraid of taking a position in the market and show the way. They know the sector has a (very) low trust with consumers. They want to show that they are socially good.
Brand: Their brand is something else. They are not afraid of taking a position in the market and show the way. They know the sector has a (very) low trust with consumers. They want to show that they are socially good.
21/x The bull
The sector is moving: So we already highlighted the disruption, but the sector itself is also moving (from a need-perspective), so Lemonade will be a trendsetter, and it always good to be an investor in something which set the trends.
The sector is moving: So we already highlighted the disruption, but the sector itself is also moving (from a need-perspective), so Lemonade will be a trendsetter, and it always good to be an investor in something which set the trends.
22/x The bull
Growth: This one could be bearish, but it is more important to maintain growth over profit. They focus very hard on the CAC and costumers instead of margins, which give the necessary scale.
Growth: This one could be bearish, but it is more important to maintain growth over profit. They focus very hard on the CAC and costumers instead of margins, which give the necessary scale.
23/x The bull
Marketing: Their marketing is next to none in this sector. They have beaten the others up, and I love it!
It is simply too hard for their competitors to change their setup to modern and “hip” because of their culture, etc.
h/t: @lemonadeinvest
Marketing: Their marketing is next to none in this sector. They have beaten the others up, and I love it!
It is simply too hard for their competitors to change their setup to modern and “hip” because of their culture, etc.
h/t: @lemonadeinvest
24/x The bear
The short volume is pretty high, 11th January is:
29.73% ( http://fintel.io ). Other sources (Ycharts) say around 13%.
(pretty normal that’s the data differ on this metric).
See this for good info as well: https://seekingalpha.com/article/4398299-lemonade-squeeze-grows-insane
The short volume is pretty high, 11th January is:
29.73% ( http://fintel.io ). Other sources (Ycharts) say around 13%.
(pretty normal that’s the data differ on this metric).
See this for good info as well: https://seekingalpha.com/article/4398299-lemonade-squeeze-grows-insane
25/x The Bear
It has run very high since October, so it is not unrealistic the stock needs a setback. EV to sales of 300x. September 17th, 2020, the market cap was $2,5B. 4 months later, the market cap has exploded to $8,5B. Crazy.
It has run very high since October, so it is not unrealistic the stock needs a setback. EV to sales of 300x. September 17th, 2020, the market cap was $2,5B. 4 months later, the market cap has exploded to $8,5B. Crazy.
26/x The Bear
Lemonade is probably not a high-margin business with gross margins only hover 18% so far. They need to show how to be profitable at some time – But looking at Netflix, etc., they have a long runway to do so before the patient from the investors runs out.
Lemonade is probably not a high-margin business with gross margins only hover 18% so far. They need to show how to be profitable at some time – But looking at Netflix, etc., they have a long runway to do so before the patient from the investors runs out.
27/x The bear
We will see an increase in insurtech-scaleups, where the others also are heavily backed by VC and even some backed by the “old” companies. Lemonade has a great head start, but they need to show number 1-seat belongs to them. The playfield will be crowded.
We will see an increase in insurtech-scaleups, where the others also are heavily backed by VC and even some backed by the “old” companies. Lemonade has a great head start, but they need to show number 1-seat belongs to them. The playfield will be crowded.
28/x The bear
On the last day of the year, we also saw a report from the short-seller The friendly Bear, which
Claimed 1M customer-milestones was “one of its weakest net add quarters since inception.” And a lot of other stuff.
See more here: https://friendlybearresearch.com/2020/12/31/how-lemonade-hijacked-the-esg-movement-to-pull-off-the-1-stock-promotion-of-2020/?source=content_type%3Areact%7Cfirst_level_url%3Aarticle%7Csection%3Amain_content%7Cbutton%3Abody_link
On the last day of the year, we also saw a report from the short-seller The friendly Bear, which
Claimed 1M customer-milestones was “one of its weakest net add quarters since inception.” And a lot of other stuff.
See more here: https://friendlybearresearch.com/2020/12/31/how-lemonade-hijacked-the-esg-movement-to-pull-off-the-1-stock-promotion-of-2020/?source=content_type%3Areact%7Cfirst_level_url%3Aarticle%7Csection%3Amain_content%7Cbutton%3Abody_link
29/x Info and interviews with or about the company
https://seekingalpha.com/article/4398023-lemonade-revolutionary-yet-in-bubble-territory
https://seekingalpha.com/article/4397437-comprehensive-look-lemonade-after-friendly-bears-short-critique
https://vimeo.com/437029189
https://seekingalpha.com/article/4398023-lemonade-revolutionary-yet-in-bubble-territory
https://seekingalpha.com/article/4397437-comprehensive-look-lemonade-after-friendly-bears-short-critique
https://vimeo.com/437029189
30/x Conclusion
I love their marketing, I love the founder, and I love the product! They are trying to change something. But it is not easy; they will get more competitors with a more modern approach. They will meet some negativity when trying to change this industry.
I love their marketing, I love the founder, and I love the product! They are trying to change something. But it is not easy; they will get more competitors with a more modern approach. They will meet some negativity when trying to change this industry.
31/x Conclusion
I like how they’re creating a brand before they talk business – People who are customers brag about having their insurance there; Lemonade has created a community. The same we have seen with Tesla, Apple, etc.
I like how they’re creating a brand before they talk business – People who are customers brag about having their insurance there; Lemonade has created a community. The same we have seen with Tesla, Apple, etc.
32/x Conclusion
I am not so concerned with their numbers because the build-up of a business with this scale is super expensive at the start but will be worth it in the long run. If they “own” the customers, they can easily upsell to new products.
I am not so concerned with their numbers because the build-up of a business with this scale is super expensive at the start but will be worth it in the long run. If they “own” the customers, they can easily upsell to new products.
33/33 Conclusion
For now, I will set this on the bench and wait a bit to buy. But this one is for long term investing, and that is just down my alley.
I HOPE YOU ENJOY THIS ONE! I hope it is worth a retweet or a like
Comments are welcomed!
For now, I will set this on the bench and wait a bit to buy. But this one is for long term investing, and that is just down my alley.
I HOPE YOU ENJOY THIS ONE! I hope it is worth a retweet or a like
Comments are welcomed!
