Insurtech startup Bright Health has secured a $750 million capital investment that includes funding from Cigna Ventures.
Cigna's investment arm is a new backer for the company. Bright Health's largest shareholder, New Enterprise Associates, will also participate as a co-investor. The funds will be used to help Bright Health continue to grow and enhance its differentiated alignment model.
The two companies will purchase in aggregate $750 million in perpetual preferred stock in Bright Health, according to the announcement. These shares can be converted into common stock at $4.55 per share, which is above average for Bright Health's current trading price.
Cigna will also bring its expertise in the payer space to support Bright Health's growth, according to the announcement.
“Cigna Ventures is committed to improving and expanding access to quality, affordable healthcare, and our investment in Bright Health Group aligns with our vision,” said Tom Richards, head of Cigna Ventures, in a statement. “We seek to be partners of choice and we look forward to exploring new ways that NeueHealth and Evernorth can potentially provide services to each other’s customers and clients.”
The financing is set to close in January and is not subject to additional regulatory approvals.
Bright Health went public in June, the latest in a string of startup insurers to launch an initial public offering. Competitors like Oscar Health and Clover Health also went public this year.
“The investment from Cigna and NEA signifies continued conviction in Bright Health Group’s alignment model,” said Mike Mikan, president and CEO of Bright Health Group, in a statement. “We are excited about the partnership opportunities for both Bright Health Group and Cigna to bring affordable, personalized healthcare to all consumers.”