Thatch Secures $40M Series B Funding to Revolutionize Employee Health Insurance Choices
San Francisco-based startup Thatch has announced a $40 million Series B funding round led by Index Ventures, with participation from Andreessen Horowitz (a16z), General Catalyst, SemperVirens, and ADP Ventures, among others. This brings the company’s total equity funding to $84.5 million since its launch in 2021. While the valuation remains undisclosed, co-founder Adam Stevenson confirmed it has tripled since the Series A round in early 2024.
Empowering Employees Through ICHRA Flexibility
Thatch specializes in Individual Coverage Health Reimbursement Arrangements (ICHRA), a model enabling employers to allocate tax-free healthcare budgets for employees. Unlike traditional HRAs, ICHRA allows workers to use funds for individual insurance premiums alongside out-of-pocket expenses. For example, an employee could allocate $800/month to a Kaiser HMO plan and use the remaining $200 for therapy—or invest the full $1,000 into a UnitedHealthcare PPO plan. Thatch’s platform simplifies this process by offering a marketplace where employees select customized medical, dental, and vision plans, with unused funds accessible via a dedicated debit card for additional healthcare costs.
Growth and Strategic Partnerships
Over the past 18 months, Thatch has onboarded over 1,000 companies, including high-profile clients like Dave’s Hot Chicken and Jersey Mike’s. Revenue has grown eightfold year-over-year, driven by integrations with platforms such as QuickBooks, which allows employers to seamlessly embed ICHRA into their payroll systems. A partnership with ADP is also in development, further expanding Thatch’s accessibility.
Leadership and Vision
Co-founders Chris Ellis (CEO) and Adam Stevenson (President) bring deep expertise in healthcare and fintech. Ellis, a former cancer researcher and SaaS leader, and Stevenson, a Stripe alum, have built Thatch’s infrastructure by recruiting talent from companies like Rippling and Ramp. Recent hires include Gary Daniels, ex-CEO of UnitedHealthcare’s Pacific Northwest division, who joined as Chief Growth Officer to accelerate adoption of ICHRA as the future of employer-sponsored healthcare.
Industry Impact
Index Ventures’ Jahanvi Sardana highlights Thatch’s transformative approach: “Health benefits should function like a modern marketplace—transparent, personalized, and choice-driven. Thatch isn’t just improving the system; they’re redefining it.” By combining fintech innovation with healthcare flexibility, Thatch aims to dismantle the one-size-fits-all model, empowering employees to take control of their health spending while reducing administrative burdens for employers.