Report: Benefits Startup Level Shuts Down After Acquisition Falls Through

Level, a New York-based benefits startup founded in 2018, has shut down, saying it has kept a small team to assist customers.

The company shut down abruptly after the collapse of an effort to find a buyer, The Information reported Thursday (Jan. 2), citing an email from Level CEO Paul Aaron to customers.

“Unfortunately, the deal fell through at the last minute due to external challenges beyond our control,” the email said, per the report.

According to the report, Aaron said in the email that benefits plans extending beyond the end of 2024 will terminate at the end of January, no new benefit plans will be offered for 2025, claims for existing plans can be submitted through the end of January, and any plan funds will be returned to customers on or shortly after Jan. 31.

Level did not immediately reply to PYMNTS’ request for comment sent through LinkedIn.

A recorded message at the company’s member and provider support phone number said Tuesday that Level has decided to wind down operations, effective immediately, with a small team in place to assist customers.

When announcing in April 2021 that it raised $27 million in a Series A funding round, Level said it aimed to help employers offer “bigger benefits for less,” starting with dental and vision insurance.

“We believe paying with insurance should be as easy as any other purchase,” Aaron said at the time in a press release. “So we’re rebuilding insurance from the ground up — from flexible networks to real-time claims. We’re helping employers and employees get more out of their benefits dollars.”

In another, separate incident, online bookkeeping and tax filing platform Bench Accounting said Dec. 27 that it was abruptly shutting down its platform but then said Monday (Dec. 30) that it is being acquired by Employer.com.

As of September, Bench had more than 12,000 small business customers.

Employer.com, a new company focused on human resources tech, said that Bench customers will be allowed to keep their service under the new ownership or port their data.

Bench said in an announcement: “Your service will continue seamlessly with the platform you’ve always trusted.”