Why We Invested in Flex
Flex is quickly emerging as the definitive leader for FSA/HSA payments; one of the nation’s fastest growing payment categories.
We are thrilled to announce our partnership and investment in Flex, a pioneering platform revolutionizing the way health and wellness brands accept Health Savings Account (HSA) and Flexible Spending Account (FSA) payments. By streamlining benefits-based transactions, Flex empowers health and wellness leaders to unlock new revenue streams while automating regulatory compliance. Targeting a $150 Billion USD market growing at 15% annually, Flex recently secured $10 Million USD in Series A funding led by First Round Capital.
The ballooning value of HSA and FSA accounts has created a unique opportunity for both health and wellness brands to unlock hundreds of billions of tax advantaged spending dollars for products that enhance the lives of consumers.
And yet, the HSA and FSA payment process often overwhelms both customers and brands at checkout. First, consumer eligibility for any single purchase needs to be verified by a physician with a Letter of Medical Necessity. Second, there are complex IRS and tax reporting regulations that fall squarely on over-stressed brands who would rather not accept these types of payments than face penalties for non-compliance.
Unlike traditional payment processors that treat HSA/FSA as an afterthought, Flex offers a seamless plug-and-play solution that integrates both with e-commerce leaders like Shopify and any brand’s custom APIs. This enables brands to offer tax-advantaged payments without disrupting their existing workflows; driving up to 30% higher checkout conversions and 50% increases in average order value. Rather than forcing brands to overhaul their systems, Flex’s technology embeds directly into the checkout experience, automating eligibility checks and compliance in real time using Generative AI. For consumers, the result is seamless; similar to any normal checkout experience using their credit card.
The timing for Flex couldn’t be better. As consumers increasingly prioritize health and wellness, spending via HSA and FSA accounts is surging. The infrastructure to support these transactions has lagged — until now. Flex is filling this gap with a comprehensive vertically integrated platform addresses the entire payment lifecycle; from integration to transaction processing. This sets Flex apart as a category leader.
Leading Flex is Co-Founder and CEO Sam O’Keefe, who we have known for over a decade. Mrs. O’Keefe’s experience in fraud prevention from her time at Unit21 drives the company’s vision. Joining Mrs. O’Keefe is Co-founder and CTO Miguel Toledo, a former machine learning engineer at Lyft, whose leadership is complemented by experts in financial technology, compliance, and e-commerce scaling. Together, they are building a platform that not only meets today’s demands but anticipates the future of consumer health spending.
We are excited to join Flex on this transformative journey, supporting a team that is redefining how health and wellness brands connect with their customers and change their lives.