StretchDollar, a startup dedicated to simplifying health benefits for small businesses, announced the closing of a series of seed rounds for a total of $6 million of funding, led by Fika Ventures and Oscar Health. And Precursor Ventures and Springbank also participated in rounds built on the company’s $1.8 million pre-seed funding from last fall. The additional funding will support the expansion of StretchDollar’s self-service platform and further elevate the small business benefits experience.
StretchDollar is the only platform that enables small businesses to set up custom health benefits in just 10 minutes, completely free of charge. And through StretchDollar, small businesses can offer their employees pre-tax funding to buy individual insurance plans and employees get expert help making their plan selections.
StretchDollar utilizes the IRS’s relatively new rule that formed Individual Coverage Health Reimbursement Arrangements (ICHRAs) — an acronym that delivers a straightforward benefit: allowing employers to use pre-tax dollars to cover employee healthcare expenses. And StretchDollar’s model takes the complexity out of ICHRA, by focusing on the most burdensome healthcare expense: insurance premiums.
Along with securing funding, StretchDollar is working with Oscar Health and other carriers and organizations to make affordable health insurance coverage accessible to America’s underserved small business sector and their employees.
Navigating health insurance in the U.S. is not easy, especially for small businesses that lack the size to access self-funded plans or the Human Resources team to manage the group plan paperwork.
Through StretchDollar’s ICHRA-focused model, employers set a fixed pre-tax monthly allowance that employees can apply toward insurance premiums, and all managed within StretchDollar’s platform. And employees can receive guidance from licensed brokers to find health plans on the marketplace that best suit their needs.
KEY QUOTES:
“Small business owners didn’t start their companies to manage health benefits. I’ve yet to meet a small business owner who enjoys picking which hospitals their employees can go to, or which medications they’ll have access to. It’s a complicated and overwhelming task. Our solution keeps things simple, giving employees more choice while saving employers the hassle.”
– StretchDollar, CEO and co-founder Marshall Darr
“Fika Ventures is thrilled to back StretchDollar’s mission to democratize healthcare access for small businesses through their innovative ICHRA platform that transforms a painful 100+ hour process into a 10-minute setup. With skyrocketing healthcare costs creating an unsustainable burden for SMBs, we believe Marshall and Kaiza’s proven track record and laser focus on the underserved small business segment positions them perfectly to capture a massive market opportunity in the rapidly growing ICHRA space.”
– Tianxiang (TX) Zhuo, General Partner with Fika Ventures
“More than 50% of small businesses are unable to offer health insurance to their employees today. Many businesses, especially those with less than 50 employees, do not have the resources to weather the skyrocketing costs of employer-sponsored plans. The individual market fills the gap: employers have an efficient way for employees to purchase health insurance and employees choose the plans that best fit their needs.”
– Mark Bertolini, CEO of Oscar Health
“StretchDollar was significantly more affordable than what my PEO offered. My employees got to choose the plans they wanted, and I had everything set up in less than a day. It’s a win all around.”
– Adam Treboutat, CEO of TNT Growth, a Miami-based advertising agency with employees on both coasts
