Beijing-based online insurance platform Waterdrop, also known as Shuidi in China, is raising USD 360 million by offering 30 million American depositary shares at USD 12 apiece in its public listing on the New York Stock Exchange, at the high end of the target range, according to a release by the company on Friday.
The company, which is backed by Tencent, Swiss Re, and Meituan, runs an online insurance marketplace, called Shuidibao, which includes 19.2 million paying customers at the end of last year, up from 8.8 million in 2019. The cumulative value of insurance premiums on the platform reached RMB 14.4 billion (USD 2.2 billion) in 2020, up from RMB 6.7 billion in 2019.
Thanks to its rapid user growth, the firm doubled its revenue in 2020 to RMB 3 billion (USD 464.1 million). However, its net loss also increased to RMB 663.9 million in 2020, from RMB 321.5 million a year earlier. Most of the revenues are generated by charging fees to third party insurers such as Anxin, ZhongAn, and China Taiping, which distribute their policies on Waterdrop’s platforms, according to the IPO prospectus.
The company also operates a crowdfunding service, called Shuidichou, that allows ill people to raise money for medical bills they can’t afford to pay themselves, without charging them a commission fee. Some of the 340 million donors on Shuidichou are cross-sold insurance policies.