Elevator Pitch is a regular feature on Lifehacker where we profile startups and new companies and pick their brains for entrepreneurial advice. This week, we're talking with Ben Thompson, CEO of Employment Hero.
In 128 words or less, explain your business idea.
Employment Hero gives Australian businesses access to our HR, Payroll and Benefits platform free of charge, so they can optimise the way their employment is managed, replacing paper-based files with automated, efficient, and compliant processes.
Our key offering is the built-in employee benefits program, which makes it simple and cost-effective for employers of all sizes to offer and administer a range of employee benefits typically associated with big employers.
Using the wealth of data already on an employee's HR file (age, income, tenure duration, home address, health, super funds, etc.) our platform offers special and personalised deals from 50+ partnerships in health insurance, home loans, car leasing, mobile phone plans, discounted utilities, etc. These deals can add up to a value of $7,500 or more to allow employers to make salaries and bonuses go even further.
What strategies are you using to grow and finance your idea?
To keep developing our idea to reach more employees, we're using network effects and a cloud platform. We've created a market that allows our partners to deliver their products and services at a reduced rate to employees more effectively than traditional pipelines
As long as we keep delivering great value to employees and employers, Employment Hero will keep scaling up. As more employees join the platform, we’ll attract more benefit providers. The more competitive the offer pricing becomes – the more employees will win. And the more employees win, the more satisfied they become with their employers who in turn benefit from high employee morale, low turnover, and reduced HR risks. The more employees and employers win, the more successful our business becomes, creating more opportunities to broker an increasing number of benefits on our platform.
Ultimately, our supplier network becomes our sales network, and it's working in the background. But this only works if you can prove to them that it's in their best interest by improving conversions - and this is what we're doing at Employment Hero.
What’s the biggest challenge facing your business?
As our product offering is unique and playing in a new market category that has never existed before, the biggest challenge is educating the market about newer ways to do this. For background, HR is still managed today in the same way as it was in the 1950s - before the fax machine was invented - using manila folders and filing cabinets.
We're getting good traction from businesses of all sizes including some recognisable names like oOh! Media and Kogan, and we're looking to help even more Aussie businesses realise the new revolution of HR.
How do you differentiate your business from your competitors?
As we're a two-year-old company in a new market category delivering a unique offering, we don't see any direct competitors out there. If we compare it to 'traditional HR software' that's currently out there, our platform is free. Yep, free.
Our freemium model allows businesses to effectively run a pilot test with their employees with no risk at all. Depending on the business and size, this could mean an instant value of hundreds of dollars, for employees, which is perfect timing for Aussie businesses now during the upcoming review season.
25,000 employees have already signed up to the Employment Hero platform, and on average they are hundreds of dollars better off by accessing special deals that are traditionally reserved for employees of large corporations.
What one phone, tablet or PC application could you not live without?
I've just picked up the new 9.7" iPad Pro and have had it for four weeks. The initial reason was to have a lighter and more mobile device to complement my Macbook Pro, but since using the tablet, I haven't needed to turn on my laptop. It goes to show how a professional tablet could potentially change the traditional laptop in the modern workplace.
What’s the best piece of business advice you’ve ever received?
I think my favourite one is from Winston Churchill, "If you're going through hell, keep going." I came across it a while ago when I visited the Churchill War Rooms in London and it's stuck with me ever since. It perfectly symbolises the journey of an entrepreneur during the first few years of starting and growing a business.
The other piece of advice, especially one that drives Employment Hero's new market business strategy, is "Create the market and then take a tiny percentage of everything that goes through it." Traditional players like credit card companies and emerging names like PayPal and Uber have fully embraced this approach.
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