This Philadelphia startup offers a fee-free option for small business health insurance

For small businesses, options for providing healthcare are limited, but Philly-founded startup  StretchDollar aims to provide a third choice. 

Small businesses can easily spend hundreds of hours setting up a small group plan, incurring costs of around a thousand dollars per employee each month — and still end up with a plan staff might not appreciate due to high copays, high deductibles, and narrow networks.

Or, small business owners can choose to do nothing. Of the 44% of small US employers that don’t offer health insurance, nearly two-thirds said the reason is it’s too expensive, according to a 2023 survey by the pressure group National Federation of Independent Business.

Enter StretchDollar. 

The platform aims to provide instant, budget-friendly health benefits for small businesses by enabling employers to offer tax-free funding employees can use to pay for individual market health plans that best suit their personal needs.

Every dollar sent through StretchDollar lands in the employee’s bank account, tax free.

CEO and cofounder Marshall Darr spent the last decade immersed in employee benefits at SaaS HR platforms Gusto and Decent, so he has firsthand experience with the challenges small businesses face. 

That experience inspired him and his former colleagues to launch StretchDollar, aiming to provide a clear starting point for businesses seeking health benefits. In 2023, StretchDollar successfully raised $1.6 million in funding from investors including Precursor Ventures, Elefund, v1vc, Kindergarten Ventures, and Westerly Ventures.

In a major move this month, StretchDollar announced it was eliminating all fees.

Tune in to this episode of Founding Philly to hear Marshall share his journey of founding StretchDollar, the invaluable lessons learned along the way, and how he and his team are transforming the approach to health benefits for small businesses and their employees.