San Francisco – September 18, 2026 -- Thatch, a health benefits platform enabling employers to replace group health plans with individual employee budgets, has raised $108 million in new funding at a $1 billion valuation. The round was led by 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.
Revenue climbs nearly sevenfold as employer adoption crosses 5,000
Thatch's revenue has grown nearly seven-fold over the past year, and more than 5,000 employers now use the platform to shift from traditional one-size-fits-all group health plans toward a consumer-directed model. Under this structure, employers set a defined health benefits budget, and employees use tax-free dollars to select an individual health plan matched to their doctors, prescriptions, family situation and coverage preferences.
Employees can allocate leftover funds to GLP1s and therapy
Beyond plan selection, employees can direct remaining budget toward eligible healthcare expenses, including GLP1 medications and therapy. Thatch says the model gives employers more predictable healthcare spending while transferring purchasing decisions to the individuals using the coverage.
CEO Chris Ellis says budget control drives cost-comparison behavior
"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."
Distribution network spans ADP, Paychex, Gusto and QuickBooks
Thatch has built infrastructure connecting employers and employees to individual coverage while integrating with major health insurance carriers, payroll providers and benefits platforms. Partnerships with ADP, Paychex, Gusto and QuickBooks allow employers to adopt the consumer-directed model without rebuilding existing benefits infrastructure.
Index Ventures partner frames healthcare shift alongside Amazon, Expedia, Robinhood
Jahanvi Sardana, Partner at Index Ventures, compared the shift to prior consumer-market transformations. "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," Sardana said, adding that AI could eventually enable an agent that finds, books and pays for care on a person's behalf.