Key Takeaways
- • Rhino, a security deposit insurance provider, raised $95 million in a pre-IPO funding round led by Tiger Global Management, valuing the company at $500 million.
- • The round included participation from Kairos (co-founder and mission-based venture fund) and Lakestar VC, with deployment intended to accelerate growth toward an IPO within two years.
- • Rhino has achieved $60 million in annual recurring revenue under contract as of January 2021, up from $4 million in January 2019, with targets to reach $100 million ARR by Q3 2021.
- • The company's business model replaces upfront security deposits with monthly insurance premiums, reducing tenant cash requirements while generating recurring revenue streams that can exceed traditional deposit amounts.
- • Rhino plans to launch new products in 2021, including offerings for lenders, and is pursuing "renter's choice" legislation across multiple states and cities as a core growth strategy.
Summary
Rhino, a New York-based insurtech company specializing in security deposit insurance, announced a $95 million pre-IPO funding round on January 26, 2021, valuing the firm at $500 million. The round was led by Tiger Global Management, the hedge fund-turned-technology investment firm, with participation from Kairos—the mission-based venture capital fund that co-founded Rhino—and Lakestar VC, a European-focused venture investor. According to Kairos CEO and Rhino co-founder Ankur Jain, the capital infusion targets IPO readiness within the next two years.
Rhino's core product addresses a structural pain point in residential rentals: the upfront security deposit requirement. Rather than requiring tenants to pay a cash sum typically equal to one month's rent, Rhino offers insurance that allows renters to pay a monthly fee instead. This arrangement benefits renters by eliminating large upfront capital requirements while providing Rhino with recurring revenue streams. When a lease concludes without landlord claims against the deposit, Rhino retains the accumulated monthly payments—which can exceed the original deposit amount—creating a profitable unit economics model.
The company's financial trajectory reflects aggressive scaling. Rhino reported $60 million in annual recurring revenue under contract as of the announcement date, representing a 15-fold increase from $4 million in January 2019. Management publicly stated targets to reach $100 million ARR by the third quarter of 2021. Beyond organic growth, Rhino is pursuing a regulatory expansion strategy centered on "renter's choice" laws—legislative initiatives across multiple states and cities that would give tenants the option to use deposit insurance instead of traditional deposits. The new capital will fund product diversification, with launches planned for 2021 including a lending-focused product to expand addressable market penetration.
Rhino's core product addresses a structural pain point in residential rentals: the upfront security deposit requirement. Rather than requiring tenants to pay a cash sum typically equal to one month's rent, Rhino offers insurance that allows renters to pay a monthly fee instead. This arrangement benefits renters by eliminating large upfront capital requirements while providing Rhino with recurring revenue streams. When a lease concludes without landlord claims against the deposit, Rhino retains the accumulated monthly payments—which can exceed the original deposit amount—creating a profitable unit economics model.
The company's financial trajectory reflects aggressive scaling. Rhino reported $60 million in annual recurring revenue under contract as of the announcement date, representing a 15-fold increase from $4 million in January 2019. Management publicly stated targets to reach $100 million ARR by the third quarter of 2021. Beyond organic growth, Rhino is pursuing a regulatory expansion strategy centered on "renter's choice" laws—legislative initiatives across multiple states and cities that would give tenants the option to use deposit insurance instead of traditional deposits. The new capital will fund product diversification, with launches planned for 2021 including a lending-focused product to expand addressable market penetration.
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