Slingshot Emerges From Stealth With $27M to Automate Checkout Insurance

Slingshot Insurance has announced its arrival with $27 million in seed funding after operating in stealth mode. Rally Ventures and Skyward Group jointly led the round, supported by insurance veterans including Jim Hays, who is joining the company's board. Rally also serves as a co-founder of the Minneapolis-based startup, continuing its practice of co-founding roughly eight portfolio companies that have either launched or remain undisclosed.

Led by first-time CEO Ethan Genteman, Slingshot focuses on embedded insurance—small policies consumers purchase alongside other transactions, such as coverage when booking travel. The company's platform enables businesses to offer these policies by connecting them with insurers, using AI to manage data exchange between both parties and reduce administrative overhead that typically makes low-cost policies unprofitable to distribute.

Vertical Insure serves as Slingshot's inaugural customer and design partner, operating across more than 750,000 customers with an average premium of $25. Genteman indicated that Slingshot's first program would launch in the current month. Currently, the six-person team, which officially started operations on July 1, generates revenue as a technology provider working alongside external insurers. However, the company is pursuing an acquisition that would enable it to underwrite policies directly.

We're not a carrier yet, but we are rapidly closing on our carrier.

Ethan Genteman

Economics of low-premium insurance

Slingshot is developing a product allowing parents to purchase insurance when enrolling children in youth sports. A parent investing $2,000 in a volleyball league, for instance, could add a $25 policy covering cancellation or injury during the season. Managing such policies involves paperwork, insurer coordination, and potential claims processing—costs that can quickly consume the revenue from inexpensive coverage.

Genteman contends that as vertical SaaS businesses seek growth beyond traditional subscription models, embedded insurance represents "a largely untapped opportunity" to generate incremental revenue from transactions already occurring on their platforms while providing customer value. He acknowledged the barrier: "The challenge is that the insurance and regulatory landscape is incredibly complex, and most SaaS companies don't have the expertise, industry relationships or understanding of where to begin."

Slingshot addresses this through white-glove service for vertical SaaS companies, guiding them from insurance concept to "a fully operational offering." Genteman illustrated the economics with an example: a program generating $500,000 in premiums with a 10% margin yields only $50,000 in margin. "That's not a viable program for the way incumbent carriers have set themselves up operationally," he noted.

The company plans to replace the manual workflows—spreadsheets, emails, and disconnected systems—that currently manage these operations with software linking policy distributors and insurers directly. Slingshot's AI automates data-intensive processes while maintaining an audit trail of decisions that participating businesses can review. The platform charges a 5% technology fee to administer programs. Acquiring an insurer would enable Slingshot to supply both software and financial backing.

Customer partnership shaped the product

Vertical Insure's operational challenges directly influenced Slingshot's creation. Rally had previously co-founded Vertical Insure, which uses software platforms to distribute insurance to its customer base. According to Genteman, the business identified opportunities to expand its product offerings but encountered difficulty locating insurers whose technology and operations could scale accordingly.

We can design the products our customers need almost overnight, but the industry is highly regulated, and we need delegated authority just to write and distribute what we've built. The antiquated approval process on the carrier-side slows everything down.

Brock Noland, Vertical Insure co-founder and CEO

Beyond finding a willing insurer, integrating the two companies' systems introduced additional delays, Genteman explained. Slingshot was developed to resolve these issues, with Vertical Insure functioning as a design partner to refine the product. Noland also serves as a Slingshot co-founder.

Vertical SaaS as the target market

Genteman identifies a significant opportunity across vertical SaaS companies—software businesses serving specific industries. As these companies explore revenue streams beyond subscriptions, insurance offers a path to monetize purchases customers already make through their platforms. These businesses possess intimate knowledge of their customers and purchasing behavior, positioning them to offer tailored coverage.

A babysitting platform might offer coverage helping parents secure replacement childcare if a sitter cancels unexpectedly. Pet boarding software could provide protection against unexpected veterinary expenses if an animal is injured during a stay. Equipment rental platforms could enable customers to add damage or theft protection at checkout. Slingshot aims to help vertical SaaS companies transform such concepts into sellable insurance, providing both the software infrastructure and guidance through insurance regulations.

Insurance becomes another product that can be offered naturally within the existing customer experience.

Ethan Genteman

Justin Kaufenberg, managing director at Rally Ventures, brings relevant experience. Before joining Rally, he led SportsEngine, where insurance sold through its platform became a significant revenue contributor. "That experience gave me firsthand insight into the opportunity for software companies to generate revenue through embedded financial products," he wrote via email. Kaufenberg observes comparable potential across Rally's portfolio, where most companies blend AI products with financial services. He noted that founders increasingly seek insurance partners capable of rapid coverage deployment.

Rally co-founded Slingshot to consolidate insurance backing, underwriting, reporting, claims handling, and distribution within a single entity. "To get the carrier, the reinsurance, the underwriting platform, the data flow engine, the reporting capabilities, the claims handling, the embedded distribution engine, and every other part of the offering from a single vendor is unheard of," Kaufenberg stated.

From insurance executive to founder

Genteman previously served as chief actuarial officer at publicly traded Palomar Holdings, where he also oversaw data operations. He joined in 2019 and built the company's actuarial and data team as it diversified beyond earthquake insurance into additional coverage categories. This experience prompted him to investigate whether emerging technology could lower insurance program operating costs. Approximately one year ago, he began coding and developing prototypes from his home. He initiated conversations with Rally toward the end of 2025 and departed Palomar on July 1 to lead Slingshot.