Health care startup Gravie announced Tuesday that it will receive a $179 million equity investment from New York-based private equity firm General Atlantic and existing investors.
The Minneapolis-based health benefits company said the Series F funds, $25 million of which came from existing investors FirstMark Capital and AXA Venture Partners, would be used to scale the company’s operations, including its flagship health plan for small- and medium-sized businesses.
The investment is expected to close within 30 days, pending regulatory approval, the company says.
At a time of investor hesitancy in the ecosystem, such an investment is a “great endorsement” of Gravie’s growth, Chief Brand Officer Jeff Smokler said in an interview.
"We are thrilled to welcome General Atlantic to the organization as a key shareholder and look forward to leveraging their knowledge and expertise as we seek to continue to scale the company rapidly,” Co-Founder and Co-CEO Abir Sen said in the announcement.
Growth is the focus for Gravie, which has increased its employee count – now at about 300 full-time employees – by 200% since the beginning of 2022, Smokler said.
The company is planning to hire an additional 75 employees or so this year, he added.
Gravie helps small- and medium-sized provide health insurance for their employees through their flagship product called Comfort. It uses a defined-contribution approach, where employees choose how much money they’re willing to contribute to employee health plans and are able to choose their own plans.
The company has seen significant growth and funding since it was founded 2013. Within the past year, Gravie moved into an office in the Riverplace complex in Northeast Minneapolis after outgrowing its space in downtown’s Lumber Exchange Building.
To date, Gravie has raised over $300 million, Smokler said. That includes a $90 million Series E round of funding last year and a $28 million round in 2021, Minne Inno reported.
Though he declined to give specifics, Smokler did say that Gravie's revenue tripled from 2021 to 2022.
Gravie currently provides health benefits to the employees and families of over 1,200 companies across the U.S., the company says.
