Thatch raises $108M at $1B valuation as employers shift away from traditional health plans. Sep 15, 2026, 13:00 ET Revenue has grown nearly 7x in the past year, with more than 5,000 employers now using Thatch to give employees greater control over their healthcare SAN FRANCISCO, Sept. 15, 2026 /PRNewswire/ - Thatch, the health benefits platform helping employers move from traditional group health plans to a consumer-directed model, today announced that it has raised $108 million in new funding at a $1 billion valuation from The General Partnership, Index Ventures, General Catalyst, and Andreessen Horowitz, with participation from ADP Ventures, Paychex, Eli Lilly and Company, Scale Venture Partners, QuantumLight, SemperVirens, Quiet Capital, and Avid Ventures. Thatch's growth is signaling a broader shift in how employers think about healthcare benefits. The company's revenue has grown nearly seven-fold over the past year, with more than 5,000 employers now using the platform to move away from traditional group health plans toward a model that gives employees control over how their healthcare dollars are spent. The traction comes as employers face a fundamental problem with the traditional system: healthcare costs continue to rise, while a single plan designed around the "average" employee rarely works well for everyone. Thatch's growth is evidence that employers are increasingly willing to rethink that model - shifting from choosing one plan for their workforce to giving employees a budget and the ability to choose coverage based on their own needs. The model is straightforward: employers set a defined health benefits budget and employees use those tax-free dollars to choose an individual health plan that fits their needs, including their doctors, prescriptions, family situation and preferred type of coverage. Employees can also use remaining funds for eligible healthcare expenses like GLP1s, therapy and more. The shift gives employers more predictability over their healthcare spend while putting the purchasing decision in the hands of the person actually using the healthcare. "For too long, healthcare has been the one major purchase in someone's life they never actually got to make," said Chris Ellis, co-founder and chief executive of Thatch. "Give people control over their own healthcare dollars, and the first thing they do is ask what something actually costs. That's the behavior change this round is built to scale." The company believes this shift could have implications well beyond health insurance. Healthcare represents one of the largest categories of household and employer spending in the U.S., yet the individual has historically had little control over how those dollars are allocated. Thatch is building the infrastructure to make healthcare function more like other major consumer markets, where people have a budget, can compare options and ultimately decide what works best for them. "Every massive consumer market eventually gets rebuilt around the individual - Amazon did it for retail, Expedia for travel, Robinhood for investing. Thatch is doing it for healthcare," said Jahanvi Sardana, Partner at Index Ventures. "With AI, the end state is bigger than shopping: an agent that knows you, holds your wallet and can find, book and pay for the right care. The magic is that you stop navigating healthcare and start being taken care of." Thatch has built the infrastructure to make that transition possible at scale, connecting employers and employees to individual coverage while integrating with major health insurance carriers, payroll providers and benefits platforms. Its distribution network includes partnerships with ADP, Paychex, Gusto and QuickBooks, enabling employers to move to a consumer-directed model without rebuilding their existing benefits infrastructure. About Thatch Thatch is the health benefits platform that replaces one-size-fits-all group plans with individual health budgets. Instead of picking a single plan for everyone, companies give employees a tax-free budget to buy their own medical plan and pay for the health services they actually use. More than 5,000 employers use Thatch today. Backed by The General Partnership, Index Ventures, General Catalyst, and Andreessen Horowitz, Thatch is on a mission to build a healthcare system people love by changing the way we fund it. Learn more at thatch.com. SOURCE Thatch

Thatch has raised $108 million at a $1 billion valuation to expand its health benefits platform. The San Francisco-based company now serves more than 5,000 employers and has seen revenue increase nearly sevenfold in the past year. The financing was led by The General Partnership, Index Ventures, General Catalyst and Andreessen Horowitz, with participation from ADP Ventures, Paychex and Eli Lilly and Company, among others. Thatch's platform allows employers to provide defined healthcare budgets to employees, who can then choose individual health insurance coverage based on their personal needs. This differs from traditional group health plans where employers select coverage for their entire workforce. The company has integrated with major health insurance carriers and payroll providers including ADP, Paychex, Gusto and QuickBooks. Thatch aims to make healthcare purchasing decisions more consumer-driven, with plans to incorporate AI agents to help individuals navigate care options.

Health benefits platform Thatch reaches $1B valuation as healthcare costs surge. 10:02 AM PDT · September 15, 2026 Thatch, a platform that lowers healthcare costs for employers while expanding plan choices for workers, has raised $108 million at a $1 billion valuation from existing investors: The General Partnership, Index Ventures, General Catalyst, and Andreessen Horowitz. The new fundraise comes 17 months after Thatch raised a $40 million Series B at a $410 million valuation, according to PitchBook. That's a remarkable valuation leap for a company that isn't, at its core, an AI startup. Thatch grew its annual recurring revenue about seven times, co-founder and CEO Chris Ellis told TechCrunch. Ellis co-founded Thatch in 2021 with former Stripe engineering exec Adam Stevenson (pictured right). Two major forces are driving the startup's growth. First, employer healthcare costs keep surging, with 2027 expenses projected to jump over 8% - the largest increase since 2003. At the same time, employees are increasingly eager to access new treatments like GLP-1 drugs (weight-loss and diabetes medications such as Ozempic and Wegovy), which traditional health plans rarely cover. Thatch helps employers keep healthcare costs manageable by offering an individual plan marketplace through what's known as an ICHRA (Individual Coverage Health Reimbursement Arrangement) - a model created by federal regulation in 2020 that lets companies fund employees' own individual insurance plans instead of enrolling everyone in one company-wide plan. Under ICHRAs, which recently rebranded as CHOICE, employers no longer have to negotiate traditional healthcare agreements with individual insurance carriers like Anthem or United Healthcare. Instead, companies set a fixed health budget for each worker, who can then use those pre-tax funds to choose among dozens of health, dental, and vision plans on Thatch's marketplace. Thatch uses AI to recommend the optimal health plan for each employee's specific needs. Those needing extensive care can supplement their allowance out of pocket for comprehensive coverage. Healthier workers, meanwhile, can opt for lower-cost plans and use the leftover funds via a Thatch debit card for other eligible health expenses like GLP-1s or an Oura Ring. AI researchers go full doomer while Apple puts AI front-and-center | Equity Podcast Ellis claims that this arrangement is a win-win for employers and workers. "If [employees] don't like their insurance, they can switch to another one," he said. "It creates pressure on insurers to compete for better service, denying fewer claims because they want to keep you as a customer." The benefit to employers is that they no longer have to renegotiate with carriers annually, yet they can still provide the same level of coverage, often at a slightly lower cost, he said. Thatch isn't the only company taking advantage of the six-year-old regulation to offer employers an alternative to the traditional healthcare benefits model. Competitors include other startups such as Take Command, Remodel Health, and Zorro. "People are waking up to this because of costs, but then they're realizing this is a better, more efficient way to do it," Ellis said. When you purchase through links in our articles, we may earn a small commission. This doesn't affect our editorial independence. Marina Temkin Reporter, Venture Marina Temkin is a venture capital and startups reporter at TechCrunch. Prior to joining TechCrunch, she wrote about VC for PitchBook and Venture Capital Journal. Earlier in her career, Marina was a financial analyst and earned a CFA charterholder designation. You can contact or verify outreach from Marina by emailing [email protected] or via encrypted message at +1 347-683-3909 on Signal. October 13 - 15 San Francisco Last day to book an exhibit table is September 18. Don't miss out on high-impact leads, investor access, and a brand spotlight in Disrupt's Expo Hall.