SAN FRANCISCO & PHILADELPHIA--(BUSINESS WIRE)--StretchDollar, a startup that enables small employers to provide pre-tax funding to employee-owned health insurance, has announced its launch in Illinois, Pennsylvania, Delaware and Colorado. The company’s roadmap includes expansion plans to cover California, North Carolina, and Texas in 2023, with a nationwide presence in all fifty states by year-end 2024. The launch coincides with the successful completion of a pre-seed funding round that raised $1.6 million from Precursor Ventures, Elefund, v1vc, Kindergarten Ventures, and Westerly Ventures.
More than 60 percent of the 5 million U.S. small businesses with less than ten employees do not offer health benefits, a historic low. Affordability is cited as a primary reason, according to a 2023 survey released by the National Federation of Independent Business. The average cost of a family health plan in 2022 was $22,400, a 45-percent increase over the last decade.
“Traditional small group health plans require mounds of paperwork, strict minimum participation rates, and high premium costs. StretchDollar makes it easy for small businesses to take care of their people and have more control of their benefits budget,” said Marshall Darr, StretchDollar co-founder and chief executive officer.
With StretchDollar, in under 10 minutes, small employers can set a fixed pre-tax monthly stipend of their choosing that employees apply to their health insurance premiums. Employees manage the benefit on StretchDollar’s platform and get guidance on selecting a health plan from the individual health insurance marketplace from StretchDollar’s licensed brokers.
This type of fixed benefit was made possible due to 2020 federal legislation that established Individual Coverage Health Reimbursement Arrangements (ICHRAs), allowing employers to use pre-tax dollars to pay for employee healthcare expenses.
“Smaller-sized businesses are often stuck choosing a one-size-fits-all health plan and being the go-between for employee health insurance questions,” explained Kaiza Molina, StretchDollar co-founder and chief operating officer. “StretchDollar removes business owners from the middle by allowing employees to choose a health plan that fits their needs, while also giving owners more flexibility with their benefits budget. It's a win-win.”
Before co-founding StretchDollar in March 2023, Marshall and Kaiza helped launch and grow health insurance startup, Decent. The two also launched the lifecycle team of the small business payroll services company, Gusto.
StretchDollar is headquartered in San Francisco, California, and Philadelphia, Pennsylvania. The company recently added an advisor Kristen Anderson, former CEO and co-founder of Catch, a startup that offers payroll and benefits for independent workers.
Enrolling in StretchDollar’s small business benefits is simple. Get started here: https://www.stretchdollar.com/get-in-touch.
- Choose a monthly benefits budget and confirm your plan.
- Set up your portal and invite your team to enroll.
- Distribute and track your benefit via the StretchDollar portal.
To learn more about how StretchDollar can help your small business, visit StretchDollar.com.
StretchDollar is on a mission to make health benefits simpler and more affordable for the five million smaller-sized small businesses based in the United States. The company is headquartered in San Francisco, California, and Philadelphia, Pennsylvania. Learn more at StretchDollar.com or email hello@StretchDollar.com.