Health insurance provider Sana has raised an additional $20 million in a Series A extension round, the company tells Crunchbase News.
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The Austin-based company is focused on offering new health insurance options for small and medium-sized businesses in an effort to add competition—and more competitive pricing—to the insurance industry, which is currently dominated by a handful of major insurers. The company will also open a new clinic, under construction now in Austin, to offer health care to local patients in the coming months.
“Our mission is to make quality health care more accessible, understandable and affordable,” Will Young, co-founder of Sana, told Crunchbase News in a recent interview. “You look at our politics, what people care about and how they’re suffering in various ways in our country, and health care is top of mind. Our [country’s health care] system is really failing the American people … and that’s where we’re working toward having a system that’s more affordable, brings people more dignity, and just works better for Americans.”
Sana’s recent funding round, led by its longtime Austin-based funder Gigafund, brings a slew of new investors to the fold, including American Family Ventures, Breyer Capital, JAM Fund and Harmon Brothers Ad Ventures.
The extension round brings its total venture capital funding to about $47 million, Young told Crunchbase News. That number includes a $6 million seed round in late 2019 and a $20.8 million Series A round in September, 2020, Crunchbase data shows.
Sana currently offers health insurance options in Arizona, Oklahoma, Texas, Illinois and Kentucky, but has grown its customer base by 140 percent over the past year, the company says. Young said he hopes the insurance provider will be an option for businesses nationally in the next few years.
Among its new customers is Houston-based Brevy, an early-stage startup that makes software to let its clients capture and report technical bugs or offer feedback on their products more easily. Anika Zaman, Brevy COO, said Sana did for her company what it promised.
“We wanted to offer our employees the best health care options available: telehealth, maternity care, mental health care and an open network,” she said in a statement. “Sana was able to provide all of that at prices we could afford and customer support that made onboarding simple.”
Meanwhile, the Austin pilot clinic, a service the company is calling Sana MD, will ideally be the first of many, Young said. If the clinic—which would focus on preventative care and paying physicians a flat fee for their work, or compensate them based on patient outcomes—works as intended, it could help reduce costs for everyone, from the patient to the insurance provider, Young said.
“The reason we are launching this primary care clinic is because we think that’s the way health care should be delivered,” he said. “One of the biggest problems with our health care system today is it’s all done on a fee-per-service basis, so doctors perform more services, and they get paid more … and there’s a fundamental misalignment with what’s best for the patient.”
The company plans to use its new influx of cash to expand into new markets and grow its reach where it already offers services. It’ll also spend money on expanding digital health care options, making care navigation easier for clients and building up its network of providers, among other investments.
Illustration: Dom Guzman
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