The company collects all contributions in one fund. The 'pooled' funds are collectively invested in e.g. shares and bonds, enabling the company to make larger investments and to diversify their investments so as not to 'bet' all the money on one horse. Each contributor is entitled to a part of the total funds including any proceeds corresponding to their contributions.
Compared to a segregated portfolio where the individual alone takes the risks, and smaller investments and less diversification of investments are possible.
HTH