A Startup That Gives Workers Cash for Health Insurance Is Now Worth $1 Billion
Thatch has raised $108 million at a $1 billion valuation, according to reporting on September 15, 2026. TechCrunch
All the money came from investors who already backed the company. The General Partnership, Index Ventures, General Catalyst and Andreessen Horowitz all put in more money. The company calls this round its Series C.
About 17 months earlier, Thatch raised $40 million at a $410 million valuation. Before the new round, its annual recurring revenue grew about seven times.
Thatch was started in 2021 by Chris Ellis and Adam Stevenson. Ellis is co-founder and CEO. Stevenson is a former Stripe engineering executive.
Thatch runs an online shop where workers pick their own health insurance. It uses a federal rule from 2020 called ICHRA, short for Individual Coverage Health Reimbursement Arrangement. That rule was recently renamed CHOICE. It lets a company give workers money for coverage instead of picking one group plan for everyone.
Think of it like a health allowance. Each worker gets a budget based on age, location and dependents, according to the company. Thatch Workers then shop for individual insurance in the marketplace. Money left over can be used elsewhere in the system.
Thatch has two add-ons. Thatch Market offers special prices from more than 50 partners for mental health, weight-loss, fertility and more. Thatch Card puts leftover budget money on a card after insurance is bought, with no forms or waiting periods. The company says more than 5,000 companies use it.
The same firms have funded Thatch before. The $40 million Series B was led by Index Ventures, with General Catalyst and Andreessen Horowitz taking part. Thatch Before that, Thatch raised $38 million in a Series A led by General Catalyst. MobiHealthNews
In my view, the fact that current investors all added money matters. They had already seen the business from the inside. A shop alone is only a storefront. With budget rules and a payment card, Thatch looks more like plumbing for a new way to pay for health care. The old way has a benefits team pick plans for everyone. The new way has the company set budgets and rules, then workers pick their own plans. That shifts the hard work from choosing plans to setting rules and moving money. Anyone who has helped a young adult sort through deductibles and doctor lists knows how confusing that can be.
Worth flagging here is that choice creates extra work behind the scenes. Insurance rules change by location. Budgets based on age and dependents must be figured correctly. Leftover money must end up where workers can actually spend it. Thatch is betting software can handle that work for many companies at once, and its sevenfold growth before this round gave investors reason to back that bet again. What this could make possible, if it works, is a simpler setup where bosses control costs and workers control their pick without piles of paperwork.
