Starting up with Jaclyn Chen

On Tuesdays, we get into the weeds with the founders of HR tech startups. Want to tell us about your company? Get in touch here.

Jaclyn Chen is the co-founder and CEO of Benepass, a flexible benefits provider that applies the pre-tax aspect of health savings accounts (HSA) to lifestyle perks and consolidates them on a single platform. Since its founding in 2019, the company has raised $14.7 million from a variety of investors, including Alumni Ventures and Operator Partners. HR Brew spoke to Chen about how her company packages fringe benefits, and the future of HR tech.

What product or service does your company offer?

Benepass helps companies distribute flexible benefits to their employees on a consolidated platform. You may have heard of the typical pre-tax account focus, like [flexible spending accounts], HSA, dependent and care commuter [benefits]. We’ve taken that formula and applied it to post-tax, employer-funded accounts, called lifestyle spending accounts. And we modernized the user experience and consolidated all those benefits onto one platform, and one card…both accessible from mobile and web.

What specific issue in HR does your company intend to solve?

We’re solving for personalization for employees, which I think would otherwise be extremely difficult without a service like ours. If you think about a company with thousands of employees, everyone’s personal definition of well-being, their family situation, their ideal work-from-home setup, it’s different. It’s impossible for companies to offer something that’s exactly right for everyone, which is why the vast majority of ancillary benefits are extremely underutilized. With Benepass, the company can set guidelines and the employees can use [their] lifestyle spending account by using the Benepass card on what makes the most sense for them.

How does your company solve this issue?

Our cards are on the Visa network, so we’re making the world’s largest network of goods and services available to employees. Every time an employee swipes the Benepass card, our software decides who, what, when, where, and how much can be spent. We’re automating employee eligibility spending, enrollment, and tax compliance. With that one file-feed set up to us, companies can deliver five, six, seven benefits in one place. Most importantly, we’re distributing benefits incredibly fast, which allows companies to respond in real time to current events.

[For example], when the pandemic hit, companies distributed work-from-home setup funds, so people could buy monitors, desk, paper, [and] better Wi-Fi. When Roe v. Wade was overturned earlier this year, companies wanted to set up medical travel [health reimbursement arrangements] to help their employees living in states where abortion is now illegal. Those are examples of how companies can effectively move to give their employees access to benefits incredibly fast through our platform.

How do you think HR tech will evolve over the next five to 10 years?

The relationship between companies and their employees will be really involved. The typical company in the US, for example, spends 30% of total comp on benefits. Benefits will become increasingly employee-led, based on employees’ personal needs and how the company [can] meet them where they are, as opposed to companies setting a menu and being somewhat paternalistic about what they offer.

How will your company help drive that evolution?

Fintech is coming to HR and we are part of that movement. You see it in global payroll, you see it in benefits, and it’s enabling personalization at scale. We’re building on modern fintech rails that make money movement dramatically faster and easier, and our mission is to help companies rethink how they can take care of their people in an equitable, inclusive, and personalized way.

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