Zego, the insurance provider for UK food delivery riders, is undergoing significant changes as it focuses on achieving profitability by 2025.
- More than 100 jobs have been cut as the company exits the B2B market to realign its strategy towards sustainable growth.
- The company’s turnover saw a slight increase while it managed to significantly reduce its pre-tax losses.
- Zego’s shift to prioritize the B2C segment is seen as a move to achieve faster profitability.
- Founded in 2016, Zego was the UK’s first insurtech unicorn and has seen fluctuations in its market strategy.
Zego, a prominent insurtech firm, has recently undertaken a major restructuring process aimed at enhancing its financial stability and ensuring long-term success. The company’s decision to cut over 100 jobs and exit the B2B market entirely marks a significant strategic shift. In a statement, Zego emphasized its realigned focus towards the business-to-consumer (B2C) segment, highlighting the potential for quicker profitability in this domain.
This extensive realignment caused redundancies, notably within the B2B segment, during the third quarter of 2023. Zego is projecting that these strategic changes will bolster sustainable growth in the years ahead. The firm is targeting monthly profitability by the start of 2025, signaling a confident outlook towards its revised business model.
Financially, Zego’s recent reports indicate a 1.1% rise in turnover, reaching £19.5 million in 2023. Crucially, the company reduced its pre-tax losses by a substantial 44%, bringing them down to £36.2 million. This improvement in financial health is largely attributed to a reduction in staffing costs, a central component of its restructuring effort.
Founded in 2016 by Harry Franks and Sten Saar, Zego quickly rose to prominence as a leading provider of insurance solutions for delivery drivers in the UK. The company’s reputation was further solidified when it became the UK’s first insurtech unicorn in 2021. Backed by noteworthy investors including Taavet Hinrikus, Target Global, DST Global, and Balderton Capital, Zego has been at the forefront of developing technology-driven insurance products.
Zego combines advanced technology and data analytics to offer customized insurance solutions, catering to the diverse needs of self-employed drivers and vehicle fleets. By aligning its services with the growing demands of the B2C market, the company aims to enhance its market position and financial outcomes.
Zego’s strategic shift to focus on the B2C segment promises a path to profitability by 2025, underscoring its commitment to sustainable growth.
