Impellent Ventures also Invests in Round and Slack Joins as Strategic Investors

It’s an exciting day for our team — not only because we’re infusing capital into our mission to transform the way businesses manage their perks programs, but because we are adding forward-thinking investors who bring a diverse set of experiences and perspectives to our brain trust. Today, Compt announced that we closed $1.5M in seed financing, led by Harlem Capital Partners with Slack and Impellent Ventures completing the round. This funding will help us reach more businesses, and ultimately, more employees, to ensure they’re happier and more engaged at work and supported in their lives.

“At Harlem Capital, it is our mission to back diverse founders who are bringing game-changing innovations to market,” says Henri Pierre-Jacques, Managing Partner of Harlem Capital. “We are excited about investing in Compt because their approach to supporting all employees through personalized perks is transformational. We looked at many companies in this space, but found that the Compt platform was completely unique. That they are such a diverse team each bringing their own perspectives to the product and solution is a direct correlation with why their platform is so different.”

As we all navigate a new reality that we have been handed over the last month — from the short-term implications on how and where we work, to the unknown long-term implications on our health and safety, and the economy, one thing remains true: it’s the individual employees on your team that push your company forward in these difficult times.

We feel it is more important than ever that employees feel uniquely rewarded for their loyalty, their effort, and their endurance, in good times and in bad. Perks are a critical component of a total benefits package and we feel empowered that these strategic investors agree with us: the old way that businesses have approached one-size-fits-all perks just isn’t cutting it anymore.

Think about it, employees typically have access to a handful of perks picked by their company that may or may not be useful in their life, and yet businesses are investing significant capital into these offerings without knowing what their employees truly want or what would be impactful to them. That’s because perks have always been point solutions (free yoga, dry cleaning, dog walking) or a vendor marketplace with limited offerings.

I started this business because as a former three-time CFO, I continued to see that our benefits spoke to only a certain percentage of our team. For years, we’ve heard experts talk about “the future of work” and the benefits and challenges of remote teams. Whether we like it or not, our entire economy was forced to transition to remote in a matter of weeks. When your employees can’t access your company’s perks because your whole team is remote, that’s when you know it’s broken, and you need a different kind of support.

In a Business Insider piece that went live this morning regarding our raise, I shared “The best kind of perk is one that employees actually use. Flexible benefit plans allow workers to choose what’s best for them, and the employer avoids wasting money on perks that just a few people will ultimately use. That cuts costs, which may help some employers avoid letting some staffers go, especially as hiring slows and unemployment ticks up.”

We believe Compt is the way of the future. Perks should be personalized and they should meet you where you are — wherever you work, wherever you live.

“We are beyond excited to be part of the new round for Compt,” says David Brown, Managing Director of Impellent Ventures. “Although funding is slowing down slightly as of recent, great entrepreneurs and great companies will thrive and create meaning in this changing environment, which is why Compt was able to put together this round with ease. In particular, as the way we do work changes, perk management and HR software companies will play a crucial role in helping companies and employees adjust to new realities, with Compt being a leader on this front.”

We’re thankful for our new investors and incredibly grateful to our early customers that have helped us improve our offering and validate the need for improved perk management in business. We can’t wait to see what’s next.

If you’re new to Compt and the future of perk management, this is a great opportunity to learn more. We’re the only perk allowance software that:

• Works seamlessly for all of your employees — regardless of whether they are at HQ, fully remote, or working in another country.
• Doesn’t limit your team to vendors so that employees can choose exactly what they want when they want it
• Has no per-user fee and simple fixed price plans
• Ensures 100 percent IRS compliance without any extra effort from you
• Offers effortless payroll and finance reporting and clear metrics for success.

Click here for a demo.

Read our Business Insider coverage: A three-time CFO just raised $1.5 million for her first startup. Here’s how she structured the HR perk management company to outlast a protracted economic downturn

Originally published at https://www.compt.io.

Compt Raises $1.5 was originally published in Compt on Medium, where people are continuing the conversation by highlighting and responding to this story.

VP: What are your goals with your perks?

Her: Right now, we need to simplify our program. We need to decrease the administrative burden our HR team member deal with from managing all of the different perks and vendors. The management of them has become unruly lately.

VP: We’ve actually heard this before, it sounds pretty frustrating.

Her: Yes, it is! We also want to simplify it for our employees too; which we think will lead to better adoption, which is our second goal. We’re constantly fielding questions about what perks are offered, accessing them, and more. It’s a lot for HR to manage, but it’s also a lot for employees to manage too.

This wasn’t the first time I heard this kind of dialogue from a people operations professional. We hear these problems all of the time.

Does the conversation above sound familiar to you? If so, you might be experiencing your own perks tipping point.

What is the perks tipping point?

I first heard about the term tipping point in Malcolm Gladwell’s book The Tipping Point.

The phrase is defined as “the point at which a series of small changes or incidents becomes significant enough to cause a larger, more important change.”

It signals an inflection point. A point in time where everything is normal, and then you wake up one day and BAM!, everything is different.

As it relates to perks, it’s the point in time when everything you were doing to offer perks was manageable, and overnight becomes out of control and overwhelming.

Does this sound familiar? Here are some other ways you can tell you have reached a tipping point:

• Your perks have grown to the point where it’s too difficult to manage all of the planning (e.g., happy hours and EOM lunches for the team), vendors, and processes.
• You’re regularly answering questions from employees about what’s offered, how to redeem, and taking suggestions for new perks, usually more often than you can keep up with.
• The budget for perks has ballooned, and now you’re being asked about adoption and ROI.

Common problem organizations face:

Within most organizations, the HR team is often one of the smaller groups, and the problems you face are vastly different than the ones other departments face. So without anybody else to talk to, it can feel like you’re the only one feeling this pain.

We can tell you that based on our conversations, the biggest problem with the perks tipping point is the issue with efficiency. More perks mean more vendors, more communication, more account logins, more questions, more management, more everything. It’s inefficient for HR as well as employees.

Preventing or reversing the perks tipping point:

You already have a lot on your plate; hiring, onboarding, exit interviews, team events, performance management processes, culture initiatives, employee questions, office moves, to name a few.

So when you find yourself amidst the perks tipping point or approaching one, we want you to know what your options are.

Below are three suggestions as to how to prevent, or reverse, the perks tipping point:

1. Don’t offer perks, or stop offering them.

Just kidding! Not offering perks isn’t really an option; especially in today’s climate with low unemployment rate, a growing skills gap, and a labor force that wants perks. While this isn’t a real option, it’s worth at least acknowledging.

2. Build your perks program from scratch

Sometimes you just have to claim bankruptcy and start over from scratch. This option is an especially appealing one if you haven’t built up an on-site adult Disney World for your employees. If this is a route you’re interested in, we built a comprehensive guide to taking you through every step of the process of building a world-class perks program.

3. Re-design the perks program around today’s innovative practices.

While it can be scary, trying something new resonates with employees. Many of your team members are encouraged to innovate within their roles, and so they expect other departments to do the same. According to a recent industry study, 48% of employees weigh innovative company benefits and perks in their decision to find their next job. (Snacknation, 2018). A little innovation can go a long way to attracting more candidates to your company.

One major innovation happening with employee perks is around perk stipends. Instead of trying to offer employees the kitchen sink, which leads to an overwhelming administrative burden, perk stipends (or lifestyle spending accounts) help you put money in the hands of employees so they’re able to purchase the perks that are most relevant to them and their always-evolving needs.

Lifestyle spending accounts flip the traditional model of purchasing perks from an HR-owned process to a collaborative one. HR sets the parameters of these programs like spending categories and budgets, and then employees purchase what makes sense for them.

This transition from HR-led to HR&Employee-led simplifies your current perks strategy, eliminates the burden on employees and HR, and ensures each dollar spent on perks is used in a meaningful way.

The perks program below is a real-world example of a perk stipend for health and wellness from one of our customers. We recorded 36 unique ways people spent their June 2019 health and wellness funds, with over 22 different gym memberships alone.

How could any HR team member develop a perks program which has this level of customization, flexibility, and meaning using today’s current model? With lifestyle spending accounts, companies can offer more flexibility without the complexity.

Want to learn more about Lifestyle Spending Accounts, check out our Ultimate Guide to Lifestyle Spending Accounts.

Ultimately, our goal is to help our team members live fulfilling and impactful lives, and perks are a big way in which we can do that.

But it’s no longer just about offering perks — that’s table-stakes today — it’s about the quality of the experience we deliver to our team members and how our perks help them live their best lives.

___

We believe there’s a better way for companies to put their benefits budget where their culture is, which is why we started Compt. Compt is the new way to offer employee perks.

If you want to be more purposeful about your perks program, sign up for a demo to see what personalized perks could look like for your team, or learn even more about perk stipends here.

___

This article originally appeared on the Compt blog titled How to Know You’ve Reached the Perks Tipping Point and What To Do About It.

Has Your Company Reached the Perks Tipping Point? was originally published in Compt on Medium, where people are continuing the conversation by highlighting and responding to this story.

“Train people well enough so they can leave, treat them well enough so they don’t.” — Richard Branson

Perks are nothing new. However, in the past decade, their role in companies has transformed from a nice-to-have bonus for employees into a bare minimum requirement.

With that level of change in the past ten years, what does the next few years have in store for perks? That’s the question we set out to answer.

We connected with various people in People Operations roles from VP to Director levels, from recruiting to office managers. We also connected with a few people tangentially involved in employee perks trends including business owners, managers, and founders of software companies.

Here are the employee perk trends that bubbled to the top:

1. Evolution away from trivial perks to more meaningful ones
2. Emphasis on flexibility and personalization
3. The way perks are thought of by employees and employers will change
4. Perks are still ancillary to critical company hygiene factors like mission, vision, values, strong leadership, etc..
5. More companies will be offering more perks

Let’s dig in, shall we?

Evolution away from trivial perks to more meaningful support.

We all know the story; when perks initially emerged, it was all ping pong, free beer, and bean bags as chairs. Since those early days, they’ve evolved quite a bit, and according to the people operations folks who weighed in, they have a lot more evolving to do. This next phase of transition promises more meaningful support for employees.

Here’s what Kelly McDonald, Head of Recruiting and People Operations at Calendly had to say:

“Employee perks are ever-evolving. It started with the in-office amenities (free lunch, snacks, beer on tap, ping pong, etc.) and now is shifting focus to personal well being.”

As more and more students graduate college with massive amounts of debt I see there being an increase in popularity of educational stipends, paying for employees to go back to school, or totally eliminating their debts.

In addition, there’s been a shift towards a focus on wellness in the workplace from something as small as standing desks or treadmill desks to gym stipends, classes on campus, and healthier food options. I actually like the shift because I think these types of perks not only help the individual employee but in doing so they are more capable of being successful in their role which ultimately helps the employer.”

Additionally, Sara Noe the HR & Office Manager at BevSpot thinks there’s a focus on more value too. She had this to say when we asked her about the future of perks:

“Less fluff (fancy beers and snacks), more employee development (career, vacation).”

Lynne Tye, the founder of the popular Key Values pointed out that there should be an increased focus on more meaningful elements of the employee experience:

“I think more companies will be open to remote work, but this is less about “offering perks” and more about needing to win the war on talent.”

I also think there is growing pressure for employers to offer more paid (and unpaid) family leave, and offering the same amount of time for all parents (biological or not). Generally speaking, startups are getting creative about the “perks” they offer, which is think is great, but also not always the most productive or important thing to focus on. I don’t believe gym stipends or catered lunches are what make employees stay or leave. They’re the things you focus on when everything else that matters isn’t going great.”

Ashley Lundquist, VP of Talent at CloudVirga had this to say:

“In my opinion, the future of employee perks revolves around work/life integration. Balance has been deemed a ‘dirty’ word by many thought leaders and the transition to integration is coming in fierce.

While the greatest opportunity for engagement resides in an emotional connection to the mission/product and relationships within the organization, perks that allow employees to smoothly integrate their personal needs with business needs have the potential to take engagement to the next level.”

Natasha Scott, Recruiting Manager at Midaxo pointed out something similar:

“Perks are significant today because typically they show the care from employers to employees for their lives as a whole. This covers work life, personal life, hobbies, family, finances, commuting, pet care, etc. (the list these days is never-ending). The ultimate goal of perks seems to equal a better quality of life. With that, perks are going to continue to weigh heavily on candidate job decisions and negotiations. At the end of the day happier, engaged employees equals higher productivity. Organizations need to keep the perks coming!”

Lastly, Justin Kang, VP of Economic Growth at the Greater Boston Chamber of Commerce emphasized that today’s workforce is getting older and thus their priorities are changing.

“Generational trends as more and more Gen Y and Gen Z join the workforce and move up the career ladder. Transition from ping pong tables to paid family leave, for example.”

New emphasis on flexibility and personalization.

Unsurprisingly, a large number of people suggested personalization would be a key trend of the future of perks.

It turns out, personalization is growing in importance in all of areas of HR.

Earlier this week, HR Trends Institute published a piece on the 10 Inspiring HR Trends for 2019, and personalization was the first trend highlighted. In the piece, the author Tom Haak pointed out that, “Historically HR has focused very much on standardization and “one-size-fits-all.” However, he ended the section with, “In 2019, personalization will get a lot of attention, and employees and organizations will benefit.”

A lot of our people operations professionals felt the same way, and the concept of personalization was a popular one for many of the higher-level people operations professionals from Director level, VP level, and CEOs.

Katherine Boardman, VP of People Operations at Litmus noted this trend:

“As we move into 2019 and beyond what’s becoming clear in our conversations with employees as well as through feedback from candidates is that “one size does not fit all” when it comes to benefits and perks. The more agile we’re able to be with structuring our programs, the better.

Through 1:1 chats and surveys we understand what people are looking for. Increasingly we are challenged to set aside our assumptions about what people want and not be tempted to apply our own sense of knowing what’s best for people.

It does take time to shift our benefits and perks program design so we iterate over a period of months and in that way, we move towards substantive changes over time.

If individuals are calling for flexibility in program design then we as an employer need to be responsive both to current team members as well as future staff. We operate in a far too competitive space not to do that.”

Katherine isn’t the only one seeing this transition.

Alexa Lightner, Director of People Analytics & Sr. Customer Success Manager from Humanyze had this to say about the future of perks:

“I think the future of employee perks will continue to move from blanket offerings that are primarily there to serve HR objectives (retention, recruitment, etc.) and become more individualized and/or team-based and intertwined with broader company objectives and operational KPIs.

With more data emerging about the ways people work and are most productive, what have been traditionally seen as “perks” will become strategic levers that organizations can pull and regularly update based on data to encourage different behaviors (such as flexible remote work options for functions that require heads-down time, strategic matching and sponsored lunch programs to encourage cross-team interaction and knowledge-transfer, and spot bonuses and reward programs for delivery teams).”

And Remington Begg, Chief Remarkable Officer at Impulse Creative says, “I think that perks are going to become much more personalized for each individual. Understanding who our team members are as individuals will allow for us all to connect on a more human level.”

Amy Spurling, Compt CEO, on the topic of how perks are evolving:

“Perks need to evolve to a place where employees can really personalize their compensation. Each of us has different needs and motivators, the companies that move towards personalization for their teams will be the ones that are truly differentiated.”

The way perks are thought of by employees and employers will change

Christopher LoDolce, Senior Manager at HubSpot and Waffle Wednesday creator points out:

“I see a future where the continuum of how different organizations use perks continues to lengthen.”

On one end, you have the basic strategy of offering attractive perks to your ideal worker whether that’s health, continuous learning, daycare, or free alcohol. These solve for the individual and their needs.

On the other end of the continuum, you have organizations using perks strategically to shape the minds, and in turn, the actions of their employees while simultaneously solving for the individuals.

The inputs into a group of individuals is what makes the culture. Perks + People = Culture. Organizations will continue to have to focus on using perks regardless of where they fall on the continuum to attract, engage, and keep their workforce delighted if they hope to grow their organization into the future.”

Perks are still ancillary to critical company hygiene factors like mission, vision, values, strong leadership, etc..

Research suggests that at least one-third of your working life, you’ll be at work. As more people are dedicating more time and energy to their companies, they’re seeking more fulfillment, purpose, and alignment with their personal lives from work as well.

Vanessa Shaw, Founder of Human Side of Tech brought this idea into focus:

“We are moving into a time when flexible work schedules will no longer be viewed as a perk, but a normal way of running a business. Employees want freedom, inspiration, and growth. Perks will become dated soon, people might say refer back to the early “2000’s Perks War” and laugh about how much we toiled over what to include in an offer package. Companies that provide growth opportunities, personal coaching, and trust to work when they want and where they want will be the companies that retain the best talent.”

Daniel Vent, Manager of Recruiting at Grand Circle Corporation agreed on the needed emphasis on basic organization hygiene factors like:

“I think that only so many companies can offer relaxed attire and happy hour. Over the next ten years, perks aren’t going to make or break companies, as the overall purpose and mission of a company that is going to be the thing that makes recruiting difficult or easy. That said, two companies with a great vision and mission, who are standardized, will be able to separate themselves by curtailing their perk offering.”

More companies will be offering more perks.

The following insight from Sam Oliver, recruiting at PathAI has a mixture of many of the items from each category above, with an emphasis on perks always evolving:

“Working at an AI/healthcare company, health & fitness perks are probably the most useful to our employees, secondary to the basic stuff like health insurance, commuter benefit, retirement account, etc.. It’s not enough to have a gym membership discount; we’ve brought fitness to work by booking yoga & boot camp classes in-office (at both morning & afternoon times to accommodate everyone). This perk makes our onsite shower/bathing/changing facilities more in-demand as well. :) Of course, we’re also putting our money where our mouth is in terms of health & fitness by heavily subsidizing our health insurance premiums.

I think this is where the future of employee perks is headed — people don’t want a game room or free beer on tap (though those things are fun), they want stuff with real, tangible value that they’d actually use outside of their job. With health insurance costs sky-rocketing, I see more employees asking about high-coverage (like 90–100%) health insurance. I also see more people asking about child care subsidies (which we help out with via free care.com memberships) as well as flex hours/remote-friendly culture.”

Nadine Robinson, Director of People Ops at Docent Health said:

“As the job market continues to be tight for talent, employers continue to look for ways to differentiate themselves. Every year, more cool stuff enters the market and employers have an opportunity to take advantage of it. Who knows what we’ll have next. In 5 years, I may be putting together a subsidy program for self-driving car subscriptions.”

Cassandra Mambro, People Operations Manager at Hopper agrees. With the talent gap widening and the labor market tightening, competition for top talent will only become more fierce. Cassandra says:

“I think the future of perks is going to get even wider — things that we haven’t even thought of yet! The competition for talent is more intense than ever and will only increase from here. Companies are on the hunt for creative ways to attract talent and will stop at (almost) nothing. While compensation is still very important, employees are interested to see what companies offer that aligns with their lifestyle.”

So there you have it, the top five trends for perks in 2019. What about you — what do you think the future of perks holds? We’d love to hear your thoughts in the comments section below.

16 Predictions on the Future of Perks in 2019 was originally published in Compt on Medium, where people are continuing the conversation by highlighting and responding to this story.

Do a Google search for “top perks” and tucked inside almost every single list in not-so-hidden sight are a surprising abundance of lifestyle spending accounts — also known as perk stipends.

• Top 20 Employee Perk Benefits and Perks of 2017 — 3 of top 20 are perk stipends
• 7 Startups With the Coolest Perks — 1 of 7 are perk stipends
• 25 Best Companies for Perks and Benefits — 4 of the 25 companies offer stipends
• 15 Cool Job Perks That Keep Employees Happy — 3 of 15 are perk allowances

They’re also used and advocated for by company culture thought leaders like Basecamp, Buffer, and Airbnb.

What is a perk stipend?

For those who haven’t heard of a perk stipend yet, it’s like a Flexible Spending Account (FSA), but instead of being a dedicated account for out-of-pocket health care costs, it’s a stipend given to employees to spend on perks.

Perk stipends are also referred to as perk allowances, or what we call them at Compt — lifestyle spending accounts.

They’re becoming more popular in today’s work climate, especially among tech companies because they dramatically improve both the employee experience, and the process of offering perks for HR team members.

Instead of a company purchasing the generic, one-size-fits-all perks that they think their employees want and which often only apply to a small percentage of people, perk stipends give employees what they truly want — something that is customized to them, their needs, and their situation.

Who are some companies offering perk stipends today?

Companies of all sizes and budgets from culture giants with deep pockets to small startups on tight budgets are bucking the traditional perks approach and are offering perk allowances.

Below are just a few examples of companies:

• Airbnb offers employees $2,000 a year to spend on travel.
• Qualtrics offers employees $1,500 a year to spend on experiences.
• Facebook offers new parents $4,000 in “baby cash” stipend.
• Microsoft gives employees an annual $800 “StayFit” reimbursement to pick their favorite way to stay fit physically, emotionally, and financially.
• Circle gives employees $200 a month to spend on lunches.
• Quantopian gives employees $200 a month to spend on health and wellness needs, and covering their cell phone bills.
• Machine learning startup Indico offers employee $5,000 to spend on career development perks like conferences and courses (online or in-person).
• Recharge offers employees $200 a month to spend on health and wellness and travel.
• Factor 5 Skin Care gives employees $75 a month to spend on continuous learning, food, health and wellness, productivity, and tech.

So what gives? Why are some of the most innovative companies skipping out on the traditional perks to begin offering perk stipends? They have massive company-shifting benefits for the employees, HR team, and the organization.

First, the positive impact on employees:

1. Offer next-level personalization.

It’s easy to forget that outside of the office, our employees are consumers in their everyday lives.

And as consumers, anything we want, we can get. Quickly, too.

If that’s the experience we’ve come to expect in our everyday lives, why should our work experience be any different?

According to millennials and gen Z, it shouldn’t.

On top of that, a recent Deloitte pieced titled Generation Z enters the workforce, offers the following insights on the incoming generation, “Most Gen Z professionals may not perceive these programs (training, flexibility, well-being programs, mentioned above) as a “perk” or a “gift,” but rather as an expectation.”

If these culture programs were lip service for millennials, they’re table stakes for Gen Z.

Millennials will soon be 75% of the workforce and Gen Z will be increasing in kind, and companies that find ways to deliver on their expectations as employees will win the war on talent.

2. Perk stipends introduce flexibility.

A recent study found that 91% of companies surveyed offer their employees snacks, 78% happy hours, and 73% offer lunch.

Snacks is almost always a must, but what about the happy hours and lunch? A recent piece that went viral on Medium, “As an Alcoholic Your Company “Perks” are Killing Me” raised an interesting perspective that can sometimes get lost — what about the people who can’t participate in happy hours. What about the people who don’t want to?

Customization is critical to success but so is being flexibility as employees and their life situations are always in flux.

Below are examples of how a person’s work or personal situation might change during their tenure at their company and how it impacts their needs:

• Needs change when achieving a major milestone at work. A new manager is likely to want to read books about leadership, take other managers our for coffee, or potentially use their stipend on a celebration or on giving back to their team in some capacity.
• Needs change when hitting major milestones in life. A new mother spends her perk allowance on family-related needs like house-cleaning or daycare, instead of what she spent it on pre-baby.
• Needs change with an update to goals. A person who prioritized having the best tech gear could shift priorities to focus on health. Their perk allowance might have been consistently used on tech gadgets, and since moved over to gyms or wearables (something to combine the old passions and new goals).
• Needs within goals change. For a person who is trying to optimize their health, one quarter they might spend their allowance on running sneakers and fitness apps, and six months later they might try something completely different like CrossFit and invest their stipend in that.

Employees need flexibility to pick what they need when they need it.

3. They give employees a voice and control.

The expectations employees have of their employers are growing.

As I said above, lines are becoming more and more blurred between work life and home-life, so as that trend continues, people’s expectations for what a company offers employees continue to follow suit.

The rub here is that employees are becoming more aware of how companies are investing in perks, and are requesting to have a say in how that money is spent.

If you run your company’s perk program, you know exactly what I’m talking about. A new part of the job has not only been fielding employee daily requests, but proactively seeking feedback and trying to find ways to deliver on it.

With perk stipends, companies provide something for everyone instead of something for some.

4. Perk stipends also make the most of every penny.

Because HR is no longer up to the impossible task of buying the perfect perk for everyone, and employees can pick the perfect perks for themselves — companies can be sure that every penny being invested is being spent on something their employees actually want.

That means no more over-ripened fruit, pawned company gifts like headphones, or unused in-office gyms.

HR team members rejoice at the prospect of this because employees are happier and they no longer have to spend expensive work hours researching, picking, and piloting all of the potential perks they could offer.

5. Plus, stipends make the perk distribution more equal.

Let’s say your company offers beer, how do you know who is drinking it and how much they’re drinking.

Most companies aren’t sure.

This means 5% could be drinking 100% of your beer or 50% of your employees are drinking 100%.

Either way, a company is investing money in this perk, but it’s unlikely that everyone is able to take advantage whether because they can’t, or they don’t like it.

I always use this example to highlight uneven and lopsided adoption because it perfectly showcases the pernicious issue that’s taking over perks programs.

6. A perk stipend decreases the administrative burden on HR.

We talked a lot about this in our other piece ‘Perks are increasing, but so are the problems they create.’

The short of it is perk stipends are incredibly easy to create and manage. Plus if your team uses a perk management software like Compt, it’s even more straightforward. Our customers at Compt are spending less than an hour a month managing their perk stipend programs.

7. Stipends can better align with company purpose or values.

Recently I met with a friend from a very successful travel company, and we talked about their company’s perk program. Their company has a value which is to “Always be learning,” and so naturally, their company reinforces this value with their employees by providing them with a $5,000 a year education stipend.

Another travel company, Airbnb wants to help their employees travel more as that the whole point of their company - to help more people travel. They give their employees $2,000 a year for them to spend on vacations. The only catch is that if they have to use Airbnb for rooms instead of hotels. This does double duty to reinforce the company’s goal, as well as help their employees’ experience life as a customer might.

8. They solve for all employees not just ones in the local HQ.

Perk stipends bring culture and perks to everyone, not just your local employees.

This matters today because 63% of companies have remote workers and this number is only projected to increase. If your company can’t adapt and figure out a way to support them, another company will.

9. Stipends are IRS compliant.

Okay, they’re not always IRS compliant. But companies that use perk management software like Compt can confidently sleep at night (you too, CFOs), knowing that perks are appropriately taxed.

We believe today’s company perks are just barely scratching the surface of what they could contribute to an employees’ life and employers alike.

To illustrate this point, a favorite quote of mine comes to mind:

“If your actions inspire others to dream more, learn more, do more, and become more, you are a leader.” — John Quincy Adams

Company perks shouldn’t be just about ping pong tables and beer. We believe in a world where perks can help people to dream more, learn more, do more, and become more.

If you want to offer your employees something meaningful, let’s connect. We’ve recently opened our limited public beta program with Compt and would love to talk to people-first, culture-forward companies. If you’ve made it this far, it’s likely you. Reach out to discuss perk programs, our public beta, and get a demo of Compt in action.

Move over traditional perk programs there’s a new perk in town was originally published in Compt on Medium, where people are continuing the conversation by highlighting and responding to this story.

Scan any reviews of a top-rated company on Glassdoor, and you’ll quickly get a birds-eye view of what matters most to employees. Employee perks.

Perks have been around for a while. However, their purpose in organizations has transformed quite a bit over the past 10 years.

Employee perks have gone from offering coffee pots to coffee baristas. They’ve gone from offering a free six-pack of Bud Lite in the shared fridge, to having a selection of local beer on tap, and they’ve gone from a rigid 9–5 to remote work with more flexibility for all.

The growth of employee perks isn’t just good for employees, perks have a measurable positive impact on a company’s bottom line.

Company perks make employees happy.

A Glassdoor Employment Confidence Survey reported, four in five employees, 80%, want benefits or perks more than a pay raise.

Who doesn’t want free lunches, nap rooms, summer Fridays, education allowances, discounts on sporting events, or an on-site gym? Company perks make employees lives easier, increase productivity, and lead to greater happiness.

Employee happiness is great for an organization’s bottom line. Studies have shown that when employees are happy, they’re 20% more productive, and for public companies, it can lead to an increased stock price.

“Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.” — Richard Branson

Perks also help foster company culture.

Earlier this year, Qualtrics announced it’s giving employees a $1,500 annual allowance to spend on experiences.

Starbucks provides full tuition reimbursement for its employees.

Reebok provides summer Fridays and an on-site gym featuring Crossfit classes, and Bain & Company holds an annual two-day global “Bain World Cup” soccer tournament open to all employees.

What do these perks tell you about the culture at these organizations? Do you have an idea of what the company values? By reading about just one of the company’s perks programs, it’s easy to get a sense of the values that matter most to the company and the culture they’re trying to build.

Perk programs develop and reinforce a company’s culture, simply by being provided.

Perks help attract, engage, and retain employees.

Similar to the word-of-mouth marketing received when customers rave about their positive experience with a company — the same thing applies to employees.

Happy employees are like indirect marketers for a brand. By rating an organization highly on Glassdoor or voting for them to win a “best place to work” award, they’re raising the value of the company as a top place to work, which attracts more talented people.

This almost goes without saying, but attracting the right talent is more critical than ever as the unemployment rate reaches an all-time low, and the talent shortage increases. Top performers have said to be up to 800% more productive, making company perks a worthy investment in employee success.

Company perks are a staple of today’s strategic approach to attracting, engaging, and retaining top talent.

However, as the number of perks offered has grown, so have the problems.

Based on my experience as a CFO and COO, I’ve noticed many destructive employee perk problems prop up which aren’t yet being acknowledged within the market. I’ve surfaced these issues below:

1. Managing company perks is a manual process & doesn’t scale.

Whether your company offers 2 or 20 perks, someone on the team still has to pick, purchase, pilot, and maintain them for the rest of the company.

Because HR is often the last department to receive software to streamline and automate their work, email filtering and spreadsheets are still the most common methods to track perks programs today. This process is not only time consuming, it’s inefficient.

I’ve scaled company perks from 25 to 250 people using email and spreadsheets, and it isn’t pretty.

2. The current process misdirects company culture.

While it’s certainly a positive that company perks can reinforce company culture, but they can also misdirect it.

As an employee, have you ever looked at a company’s perks and thought that the company looked like the best environment for you? What about the opposite? Have you ever found a company’s perks program online and decided against applying because they’re off-putting or a bad match for you?

By providing onsite yoga, there’s something else that you aren’t providing. The same concept applies to every perk being offered — i.e., money being invested in pet insurance means less money for a free books program.

Not only is there the monetary opportunity-cost of perks, there’s also the invisible cost of the employee and market perception of your perks.

3. The current perks approach doesn’t solve for diverse teams with diverse needs.

This is my biggest gripe with the current perks approach; let me address the problem by sharing an example of it in practice.

Over five years ago the company where I was CFO decided to dedicate some money toward supporting employees and enhancing company culture — as many companies were doing — and offering beer was one of the easier, more fun ways we settled on.

I had just announced that we were installing beer taps in our new office.

Everything was sunshine, rainbows, and unicorns.

Fast forward to a few months later, and people began approaching me to make personal requests because they either didn’t like the beer or couldn’t drink it.

One person asked for cider because they were gluten-free. Another requested wine because they didn’t like beer or cider. One soon-to-be mom asked if we could invest in something that wasn’t beer because she couldn’t drink but didn’t want to feel left out of team activities.

After a while though, the slippery slope of requests hit a tipping point and became something we couldn’t officially support anymore.

Having to say no to some people’s requests was deflating. I didn’t want to support just some of our people, I wanted to support all of our people.

It turns out; this problem is so prolific that at a recent People First dinner we hosted, one Head of HR said he knew he was doing his job well when everyone was “equally unhappy.” Ouch, that runs counter to the whole purpose of perks. It’s not his fault though; today’s current one-size-fits-all approach to perks is impossible to serve the needs of everyone.

Companies are earmarking money for each employee for perks, and unfortunately, if an employee doesn’t like them or can’t enjoy them, they miss out on money the business has allocated to them. And to be clear, there are employees who can’t use perks for a multitude of valid reasons such as they have dietary restrictions, they’re remote (which is especially prevalent today), they have a unique situation, or their goals and needs are different.

The problem of solving for some employees, not all, is heightened because companies are offering more perks than ever before and there’s no software to track perks and gather data insights. Without any data on employee adoption and usage, it’s impossible to see which perks are being used and by who. In the beer example, a situation could surface where only 5% of a team is drinking 100% of the beer, while those who can’t, miss out.

Apply this situation to every perk that you offer and it’s easy to see how quickly perks become lopsided offerings which don’t solve for diverse teams with diverse needs.

The challenge for HR and people operations folks is to figure out how to appropriately address each individual’s preferences and priorities while supporting with a more diverse set of workers and workforce segments than before.

Lastly, while there is one way which many companies are addressing this challenge — by offering more and more perks — it’s less than ideal. This method means more money, more perks to manage, and it’s still a “one-size-fits-none” approach to perks.

Today’s perks process is broken. It’s inefficient, doesn’t scale, misdirects a company’s culture and doesn’t genuinely solve for employees resulting in wasted money, effort, and unhappy employees.

Now that I’ve shared the hidden dark side of perks, I cannot help but ask, what will happen if we continue down this path of managing and offering employee perks in the future? Is this what employers and employees actually want?

I don’t think so.

— — — —

I believe there’s a better way for companies to put their money where their culture is which is why I started Compt. Compt is the new way to offer employee perks.

If you want to be more purposeful about your perks program, sign up for personalized perks with the Compt software here or learn more about perk stipends here.

The number of employee perks is growing, and so are the problems they create. was originally published in Compt on Medium, where people are continuing the conversation by highlighting and responding to this story.