Business benefits make or break the ability to recruit top talent. On the one hand, there is 401 (k), while on the other, there are consumer benefits, all accounts offered by the employer to be used for designated purposes that generally offer tax benefits.
Elevate has a fresh take on how employers and employees access, manage, and enjoy consumer-centric benefits. Former Businessolver executive Brian Cosgray and former ConnectYourCare founder Brian Strom launched the company in 2020.
CEO Cosgray explained that these benefits are more often than not an employee’s direct health expenses, like health savings accounts, flexible spending accounts, travel expenses, tuition reimbursement or even reimbursement of adoption or fertility treatment costs.
Statistics show that 95% of U.S. businesses offer these benefits, but are only used by 95 million U.S. employees. Meanwhile, with half of Americans enrolled in high-deductible health care plans and 21% of working-age people underinsured, consumer-focused benefit programs are meant to help compensate for the shortfalls. rising costs that employers and employees end up paying, Cosgray said.
And, with all things the tax code, administering these types of benefits can get complicated. Cosgray saw it with his own eyes: in his old company, he sold these kinds of benefits to large employers, but constantly ran into the same problem of an industry heavily reliant on a paper-based process.
âIt’s hard for employees to understand and use these benefits when there is tons of legal jargon and tons of jargon,â he told TechCrunch. âThey don’t know which card to use, mainly because there were multiple cards due to the growth of the industry through consolidation. I went looking for a better alternative and couldn’t find one.
The Denver-based company was released on Monday for a year in stealth mode. Its platform allows employees to view, plan and manage their pre-tax benefits from a web and mobile dashboard. There is also a contactless card for all the benefits, and requests are processed instantly and reimbursement is done in minutes. On the employer side, they can customize their offering with standard templates for many common plans, then configure the plan for their particular market or plan.
To date, the company has raised $ 15 million in total funding, including $ 12 million in the form of a new Series A capital injection, co-led by Greycroft and Norwest Venture Partners, with participation from the existing investor Bowery Capital. Elevate intends to use the new funds in sales, continuous product innovation, and the hiring of additional talent for its implementation and service teams.
Cosgray said it was too early to discuss growth metrics, but said the company had spent a year developing the product and now had its first set of customers. It will be rolled out to a few channel partners in the first quarter, giving Elevate access to approximately 900 employers.
Meanwhile, Ellie Wheeler, partner at Greycroft, is investing heavily in the digital health space and said that like other areas that affect consumers, employees expect a platform that has value. meaning, is as easy to use as the other products and gives them flexibility in how they can use it.
Rather than providing $ 150 to a very specific gym, employers are moving towards a benefit such as a lump sum that can be allocated as the employee chooses: some for transportation, some for childcare, or some for health care, she said.
She believes Elevate is coming to market with deep domain knowledge and expertise. The founders are also building a product “for the modern world” that does not make assumptions about needs and wants, but incorporates the flexibility for employers and employees to decide on that.
âThey know all the players and don’t go up the market curve, they know what it is,â Wheeler added. “They know how to win and they are off to a good start.”