Thatch, the health benefits platform helping employers move away from traditional group health plans toward a consumer-directed model, has announced a $108m funding round that values the company at $1bn.
The round was led by The General Partnership, Index Ventures, General Catalyst, and Andreessen Horowitz, with additional backing from ADP Ventures, Paychex, Eli Lilly and Company, Scale Venture Partners, QuantumLight, SemperVirens, Quiet Capital, and Avid Ventures.
The company said its revenue has increased almost sevenfold over the last 12 months, with over 5,000 employers now relying on its platform to shift staff away from single, one-size-fits-all group health plans and toward an approach that hands individuals more say over how their healthcare budgets are spent.
This surge in uptake reflects a wider rethink among employers, who are grappling with climbing healthcare costs and the reality that a plan built for an “average” worker often fails to suit anyone in particular. Rather than picking one policy for the whole workforce, businesses are increasingly opting to give staff a set budget and letting them choose cover that matches their own circumstances.
Under Thatch’s system, employers allocate a fixed, tax-free healthcare budget, and staff put those funds toward an individual plan suited to their needs, factoring in their preferred doctors, medications, family circumstances and type of cover. Any leftover budget can go toward other eligible healthcare costs, including GLP-1 medication and therapy. For employers, the approach brings more predictable healthcare expenditure, while shifting the actual purchasing choice to the employee using the care.
Beyond the health insurance sector, Thatch believes the model could carry wider significance. Healthcare ranks among the biggest spending categories for households and employers in the US, yet individuals have traditionally had limited say in how that money gets allocated. The company is working to build infrastructure that brings healthcare closer in line with other consumer markets, where people can set a budget, weigh up options and choose what best fits their circumstances.
To support this shift at scale, Thatch has built links with major health insurance carriers, payroll firms and benefits platforms, and counts ADP, Paychex, Gusto and QuickBooks among its distribution partners.
Thatch co-founder and chief executive Chris Ellis said, “For too long, healthcare has been the one major purchase in someone’s life they never actually got to make.
“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.”
Index Ventures partner Jahanvi Sardana said, “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.
“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.”
Copyright © 2026 FinTech Global
