Finance / Software / Startups

Elevate is a very 2020s startup

With a distributed team, a fintech-centered approach, and two funding rounds under its belt in just a year in existence, the company is setting out to replace the software used by employers to offer consumer directed benefits.

Elevate cofounders Brian Strom and Brian Cosgray. (Courtesy photo)
Where’s your company based?

Before the pandemic, it was an easy question. In an era of remote work, it’s a little different. For companies that were founded in the last year, the headquarters isn’t necessarily part of the founding story.

Take Elevate. Founded in 2020, the company recently emerged from stealth mode with software that brings fintech tools to consumer-directed benefits, which are the HDHPs, HSAs and FSAs offered by employers that allow employees to open up accounts to save funds and pay for healthcare.

The company is incorporated in Delaware (like many). CEO Brian Cosgray lives in Denver, so that’s listed as its headquarters. But the eight current team members live around the country, including Baltimore. That’s where cofounder Brian Strom is based. Strom and Cosgray, who is a former exec at Businessolver, didn’t initially meet face-to-face, but when Strom heard about the chance to a new wave of technology to a market that has gone through consolidation, he was quickly onboard.

“It took me about 20 minutes of talking to him before I decided to jump right in,” said Strom, who is Elevate’s CTO. “I saw the opportunity immediately.”

In 2002, Strom was a cofounder of Hunt Valley-based ConnectYourCare. As that team hired, leaders reached out to a local network. With Elevate, Strom said they looked nationally, and sought to bring in top professionals in the space, wherever they were.

“You don’t often get the opportunity to pull the best people from across the country, so that’s been a real change for us and something that we’re really excited about,” Strom said.

You don't often get the opportunity to pull the best people from across the country.

That includes former Wageworks COO Scott Rose, who is now in the same role with Elevate. Melanie Hallenbeck is now chief growth officer after serving in the same role at BenefitExpress.

When it went to raise funding, Strom didn’t meet any of the VCs in person. Owing to another COVID-era phenomenon, fundraising also accelerated. The company has already raised $15 million over two rounds, including a $12 million Series A that was co-led by Greycroft and Norwest Venture Partners, with participation from existing investor Bowery Capital.

Going forward, Strom expects that the team will have a Baltimore presence, as he draws on the local network with growth. But, as ever in the pandemic, nothing is certain.

Wherever it’s based, Strom is certain of opportunity in front of the team: Bringing modern technology to consumer directed benefits, which are used by 96 million Americans and offered by 95% of companies. It’s a place where Strom has experience, as ConnectYourCare replaced paper processes with software. With more consolidation in the space (ConnectYourCare now part of Optum Financial, for one), Strom sees a renewed need for technology that’s in line with the times.

“Think about 20 years ago. That’s before cloud, before mobile, before modern technology practices,” Strom said. “There’s just a real opportunity to bring some modern technology to the space.”

The company sees its technology as being less about providing services around the health benefits, and more in line with fintech. Key to this is an embrace of the API-driven development cycles that allow Elevate’s technology to be embedded within its tools.

“We think of ourselves as a payment infrastructure so that you can move money from the employer through yourself to the provider, whether it’s the doctor, the dentist or the dependent care provider,” he said. “We also provide the APIs into that infrastructure so that those modern and integrated partners can really build any kind of solution on top of us that they want.”

In practice for the employee, Strom said it can be the difference between having to wait for a week while a human reviews a submission and cuts a check, and getting a payment instantly.

“If somebody goes to the doctor and has to pay money out of pocket, that’s real money and for somebody that isn’t a high earner, that makes a real difference,” Strom said. “If it takes two weeks to get money they could be struggling with some other bill. People just want money back in their pockets as quickly as possible. We can turn that around, using modern fintech, instantaneously.”


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