My cofounder, Kaiza Molina, and I have spent the past decade working on a surprisingly hard problem—how can small businesses get access to health insurance?
The ‘go-to’ option for small businesses — fully insured small group plans — are disappearing as major health insurance carriers phase them out. This has left 60+ million Americans stuck with a horrible choice—continue to sign up for expensive, hard to use plans or abandon health benefits altogether.
The seeds of StretchDollar were planted at Gusto almost a decade ago where Kaiza and I worked to roll out their group health insurance product. From there, we joined a startup called Decent where we were attempting to build a health insurance company from scratch. It was chaos but good chaos.
While I was pinch hitting running Sales, almost every small business owner I spoke to would say the same message: - “I just wish there was a way I could give people cash and let them pick for themselves.”
That option didn’t exist at the time.
These business owners were spending 100+ hours setting up and running group health insurance plans that required them to decide which hospitals people could deliver their babies at, what medications were going to be covered, and ultimately how their team was going to be able to engage with their healthcare.
They didn’t start their business to do that. There are an impossible number of preferences to take into account, even at very small businesses.
Today, a million fewer small businesses offer their employees health benefits than in 2010. That’s not because small businesses care less about their employees than they did a decade ago. It’s because things have gotten too expensive and too complicated.
We launched StretchDollar to offer a simpler way for small businesses to take better care of their people.
On our platform, small business owners can designate a pre-tax monthly allowance that their employees can use to offset the cost of individual health insurance plans they pick themselves (with help from our brokers if they need it). Now, small business owners can set up health benefits in as little as 10 minutes while offering their people the option to pick plans that truly work for them.
Best of all—it’s working. Nearly 80% of our small business customers are offering health benefits for the first time through StretchDollar.
We started working on StretchDollar early 2023, raised a pre-seed round over that summer, and by October, we became our own first client. Less than a year later, we had a hundred small businesses on our platform.
More importantly, we saw the real impact of what we were doing – navigating people to policies that better met their health needs. One particular moment that will always stick with me was when we sat down with a type one diabetic whose insulin wasn’t covered under their company’s existing group policy. She was paying $1,400 a month out of pocket for it. We were able to find an individual market plan where it was a $30 copay.
It’s clear what we were doing was helping people and filling a need—but we needed to move faster. Which brings us to our big news…
StretchDollar has raised a $6 million seed round led by TX from Fika Ventures and with substantial contributions from Oscar Health, Springbank, and Precursor Ventures. We intend to use the funding to expand the team and build on our mission of making small businesses the best place to work – starting with access to a benefit that every employee wants – health coverage.
This is just the beginning. This funding will let us pull forward the future small businesses deserve and make sure we live in it just a bit sooner than we would have otherwise.
That said, the story of StretchDollar to date would be irresponsibly incomplete without sharing a bit about the people who came together to make this happen:
First up—the team. I’d like to just give a huge shout out to Ellen Decareau, Reef Loretto, Ashton Watson, Nick Park, Silvia Piscil, and Caroline Hou. You all are some of the most amazing people I’ve ever had the opportunity of working with. Your dedication, creativity, and joy are infectious. We’re going to change the world together.
Next, my Cofounder Kaiza. From the front desk at Gusto to changing lives all over the country. Couldn’t be prouder to be on this journey with you.
To those pre-seed investors crazy enough to trust a first time founder in the summer of 2023 who wasn’t talking about AI—Charles at Precursor, Nat at Kindergarten Ventures, Serik at Elefund, Ryan at Expansion VC, Brett and Benny at V1VC, Lyndsey at Westerly—your support literally changed our lives and it’s helping us pay it forward.
To the new faces joining with the seed—TX and the Fika crew, Courtney and all of Springbank, Emily at MKT1, this is going to be an absolute blast.
Lastly to the friends that helped us out along the way—Kristen Anderson, Shannon Goggin, Aaron Petramale, Nick Soman, Jessica Palvino, and the hundreds of others that rolled up their sleeves to help a couple of newbies—your time and advice has meant the world.
On a personal note—I’d love to thank my amazing wife Daniela Brissett and our very patient puppy Mookie for sticking by me while I tumbled through the founder’s journey. Best support squad in the world:
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