Modern health benefits startup Thatch raises $38 million

San Francisco-based Thatch has raised $38 million in Series A funding, led by Index Ventures and General Catalyst, with participation from SemperVirens, The General Partnership, Andreessen Horowitz (a16z), and Avid Ventures. This brings Thatch’s total funding to $44 million.

Founded in 2021 and launched in 2023, Thatch’s platform simplifies the complexities of the Individual Coverage Health Reimbursement Arrangement (ICHRA) law, enabling employers to offer tax-free contributions for employees to purchase their own health insurance plans.

The platform features streamlined budgeting, personalized plan selection tools, integration of tax incentives, and pooled buying power, providing a more transparent and cost-effective approach to health benefits.

“There’s finally momentum towards a health insurance market that serves real people’s needs. We’re seeing interest from employers, brokers, and certainly employees who all recognize the singular opportunity to get high-quality healthcare at a reasonable, transparent cost. With the support of this funding, we’re ready to scale operations to meet the exploding demand.” – Chris Ellis, CEO and co-founder of Thatch.

“Healthcare is the last major financial decision still controlled by employers but, like the shift from pensions to 401(k)s empowered individuals, healthcare is due for the same revolution. Thatch is driving this shift by harnessing free market forces in the individual market and pooling risk across businesses to create collective buying power. From the moment we met Chris and Adam, their deep market insight and compelling vision were unmistakable. Their relentless execution and ability to attract top talent made us confident they’re building a category-defining company.” – Jahanvi Sardana, Partner at Index Ventures.