For companies of all sizes, particularly small businesses, managing benefits can be a serious headache. With health insurance being pushed online by Obamacare and healthcare as a whole plodding its way into the digital era, a new generation of companies has popped up that’s looking to make it easy not only to manage health insurance, but a business’ entire fleet of benefits — from medical to 401(k)s.
Maxwell Health launched in February to provide small and medium-sized businesses with an affordable benefits management service that simplifies the process of creating and managing employee health plans, benefits and payroll. The startup quickly followed with a $2 million Series A raise, with Tribeca Venture Partners leading and contributions from Lerer Ventures, Vaizra Investments, BoxGroup and TiE Angels, among others.
Unlike other fast-growing startups playing in this space, like Zenefits, Maxwell is going after companies with fewer than 1,000 employees and, rather than move to replace insurance brokers, the startup is partnering with health insurance companies and brokers.
In other words, Maxwell co-founder and CEO Veer Gidwaney tells us that health insurance brokers want to talk to employers directly. So, whether it’s individual policies or larger group policies, brokers can use Maxwell’s enterprise software platform to talk to employers directly. Brokers pay monthly fees to use Maxwell’s platform, which in turn makes Maxwell free for employers.
With nearly 40 percent of the top 100 brokerages now using or in talks with Maxwell, Gidwaney says, the founders are looking to expand. To do that, the company is taking on $6 million in Series A1 financing, led by Vaizra Investments, with participation from Catalyst Health Ventures and existing investors, Tribeca Ventures, Serious Change, Lerer Ventures, BoxGroup and angels. Combined with its $2 million raise in August, this brings the company’s total Series A raise to $8 million and total to date to just under $10 million.
The interest in Maxwell Health comes as a result of the company’s effort to become a full-service management platform, or an operating system, for employers and any business under 1,000 employees — of which there are millions. This means that employers can use the platform to manage a range of HR functions as well, beyond simply onboarding employees into group health insurance policies and offering payroll administration.
The company is trying to go one step further by offering HR functionality that starts with onboarding and goes all the way down the chain to retirement planning. The idea is to allow businesses to work with their benefits advisors (i.e. brokers) over the duration of their employees’ lifetime at their company to set up and manage private health and benefits exchanges that sync with their existing plans.
To go beyond the basic suite of benefits, Maxwell offers an incentivization system for employees, which encourages them to eat healthy and get their exercise more regularly, using their fitness devices or phones to log activity. Maxwell then allows companies to reward their employees with points for meeting fitness and health goals, which can then be traded in for rewards, prizes, cash and, someday hopefully, a raise.
The startup also offers a concierge service, which essentially acts as an advisor for employers, allowing them to ask health-related questions and receive recommendations on physicians, compare prescription prices, schedule appointments and resolve insurance disputes. Employees can send photos of medical claims to the Concierge Service, for example, which will then take care of filing and managing the claim so that the employee doesn’t have to worry about it.
Today, Maxwell has a customer base that’s now “well into the triple digits,” with membership having doubled over the past six weeks, according to Gidwaney. The company’s revenue has also doubled, quarter-over-quarter, over the last six months. So, with its growth accelerating, the platform has been able to attract companies like TED and the Acumen Fund, and with its new capital in tow, the company plans to “invest heavily in customer service” and ramp up its sales and engineering teams.