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Outsourcing Perks

Companies with more money than time can pay companies like AnyPerk to manage employee perks for them.

August 5, 2014
Related Topics: Perquisites, Benefits Design and Communication, The Latest, Benefits
Perks Augutst 2014

Human resources departments outsource benefits, wellness, and rewards and recognition programs, so why not perks?

That’s the idea behind AnyPerk Inc., a San Francisco-based startup that offers a Web-based perks program with deep discounts on everything from taxi service to online dating site subscriptions for $10 per employee per month.

AnyPerk appeals to startups and other fast-growth companies that might have sufficient financial resources but not enough internal manpower to manage a perks program. Other target customers are companies that aren’t large enough to negotiate volume discounts on the merchandise or services they’d like to offer employees as perks.

Since launching 2½ years ago, AnyPerk has struck vendor deals with 400 hotels, movie theater chains, gyms and a gamut of other service providers. That’s helped it attract 2,500 corporate customers, including Cushman & Wakefield, Groupon Inc., Pinterest Inc., Snapchat Inc. and Zappos.

AnyPerk isn’t the only company managing employee perks. Another is Working Advantage, an Acton, Massachusetts-based company founded in 1995 as Corporate Movie Club that changed its name and business model in 2001 to expand into offering a variety of employee perks. Today, the company has 10,000 corporate customers with 10 million employees, and offers discounts on entertainment, shopping, sports events, travel and other activities and events.

AnyPerk graduated from Y Combinator, the well-regarded tech industry startup incubator in 2012. In late June, the 30-employee company closed on $3 million in financing from Zappos founder Tony Hsieh, venture capital firm Andreessen Horowitz and other tech-industry heavyweights, bringing its total funding to date to $4.5 million.

Outsourcing perks might be a new concept in the United States, but not in Japan, where AnyPerk Chief Executive Taro Fukuyama was born and raised. In Japan, outsourced perks is a decade-old, multimillion-dollar annual market led by a handful of companies, some of which are prepping U.S. launches. Not that Fukuyama is concerned. Outsourcing perks “isn’t a tech play, it’s a partnership play. You have to have partnerships with vendors,” he said. “We already have relationships and customers here, so I’m not worried about it.”

Handing over perks to a third party to manage isn’t for everyone though, especially at companies that can’t afford the additional overhead, said Margaret Plummer, vice president of employee development at Camden Property Trust in Houston. “I would like them to be successful and more power to them,” she said. “But if you have more limited cash, you really want to make sure where you’re spending your dollars is going to be valued by your employees.”

Fukuyama, a 2014 Workforce Game Changer, thinks he’s doing that by helping companies make sure employees know about and use the perks available to them. Before Zappos used AnyPerk, the company relied on Google Docs and wikis to organize perks, but the information was hard for employees to find. As a result, only 10 to 15 percent had used at least one perk. A year after switching to AnyPerk, 75 percent of Zappos employees had used one or more, Fukuyama said.

AnyPerk is using the cash infusion to work on a mobile app Fukuyama expects to have ready later this year. Among other things, the app will use GPS to show employees perks based on their location. “So if you go to Chicago and want a massage, we can show you there’s a spa three blocks away and you can save 20 percent,” he said.

Michelle V. Rafter is a Workforce contributing editor. Comment below or email Follow Workforce on Twitter at @workforcenews.

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