Caribou Raises $3M to Simplify Healthcare Cost Planning

Navigating the Complex World of Medicare Advantage Plans

The sheer number of Medicare Advantage plans – nearly 4,000 – presents a significant challenge for individuals seeking appropriate coverage. Selecting the incorrect plan can potentially lead to substantial financial burdens, particularly when unforeseen healthcare needs arise.

Caribou: Simplifying Healthcare Cost Prediction

Based in Miami, Caribou is a startup dedicated to streamlining this decision-making process. They offer healthcare cost prediction and optimization software, delivered as a SaaS (Software as a Service) business model specifically tailored for financial planners.

This allows advisors to provide informed guidance to their clients regarding the most suitable plan options.

How Caribou's Technology Works

Co-founded by Christine Simone, Cory Blumenfeld, and Giorgio Delgado, Caribou’s system compiles data relating to factors such as healthcare utilization patterns, existing health conditions, and current medications.

This data empowers financial advisors with a scalable tool to thoroughly assess a client’s comprehensive healthcare planning requirements.

Addressing Gaps in Financial Advice

Simone highlighted that financial advisors frequently overlook discussions concerning medication expenses or health status with their clients.

Consequently, Caribou assists advisors and their clients in identifying crucial areas like optimal health plan selection and the potential need for long-term care planning – a necessity for an estimated 70% of the population.

Origins and Motivation

Simone and Blumenfeld launched Caribou in 2020, drawing upon their prior experiences within the healthcare industry.

They observed a consistent failure to adequately address the financial implications of healthcare among various stakeholders.

“The resulting financial strain often falls upon the consumer,” Simone explained to TechCrunch. “We are witnessing escalating healthcare costs and increasing instances of medical bankruptcy, and I am thrilled that we are enabling consumers to proactively plan for these expenses and make more informed choices based on data.”

Recent Funding and Investment

Having initially raised $575,000 in early 2021, Caribou has now secured an additional $3 million in a seed funding round, bringing their total funding to $3.1 million.

Key Investors

This investment round was spearheaded by Jack and Max Altman, with participation from Dash Fund, existing investors Garage Capital and N49P, and a cohort of angel investors.

These include Leslie Schrock, Plaid CTO Jean-Denis Greze, and Tribe’s Arjun Sethi.

Filling a Critical Planning Gap

Jack Altman stated that Caribou effectively extends healthcare planning beyond the scope of employer-sponsored benefits.

“Many solutions are emerging to reduce healthcare costs for employees, companies, and insurance providers,” he noted. “However, what happens when individuals leave these organizations or their HR departments lose access to that data? Caribou’s approach, viewed through a financial planning lens, presents a valuable opportunity to reach a different customer base and provide them with significant benefits.”

Early Adoption and Customer Base

Although the software has only been available for a few months, Caribou is already experiencing rapid adoption, with a growing list of customers.

Current clients include BLB&B Advisors, CapSouth Wealth Management, and Jackson Square Capital.

Demonstrated Cost Savings

While specific growth metrics are not yet being disclosed, Simone reports substantial growth following the open enrollment period in the fourth quarter.

The company is now managing a waitlist for new firms, and has already demonstrably saved consumers hundreds of thousands of dollars in healthcare expenses.

Future Plans and Expansion

The newly acquired funding will be allocated to product development, enhancing the depth of financial insights provided and expanding the reach of the software.

Caribou also intends to bolster its customer success team and double its overall employee base by year-end.

Expanding Distribution Channels

Caribou’s primary focus remains on empowering the end consumer, and while currently distributed through the financial industry, the product roadmap includes exploring alternative distribution channels.

This includes integrating the software directly into technology platforms accessible to consumers.

“Only 39% of Americans utilize a financial advisor, so we must explore opportunities beyond this channel,” Simone explained. “Our goal is to embed our tool as a back-end plug-in within other financial technology platforms, thereby extending access to a broader consumer base.”

Note: On February 3rd, the company requested the removal of Lightspeed Scout Fund as an investor.