Use Case Podcast – Storytelling About Compt With Amy Spurling

Announcer: 00:02 Welcome to Recruiting Daily’s Use Case Podcast, a show dedicated to the storytelling that happens, or should happen, when practitioners purchase technology. Each episode is designed to inspire new ways and ideas to make your business better. As we speak with the brightest minds in recruitment and HR tech, that’s what we do. Here’s your host, William Tincup.

William Tincup: 00:25 Ladies and gentlemen, this William Tincup, and you’re listening to the Use Case Podcast. Today we have Amy on from Compt. And we’re going to be learning about the business case or the use case for why customers and prospects pick Compt. And I can’t wait to learn about it with Amy. Amy, would you do us a favor and introduce yourself and Compt?

Amy Spurling: 00:51 Sure. My pleasure. Thanks for having me.

My name is Amy Spurling, I’m the CEO and founder here at Compt. Prior to starting Compt, I’ve spent my whole career in the tech industry. I’ve been a CFO three times, I’ve been a COO twice. So helping build companies with and for other founders, usually coming in with first big VC check and then kind of figuring out how to build, grow, scale, all of those things. But in all those roles, I was managing finance and HR, which led to the genesis of me wanting to start Compt because I was seeing where the industry was moving from a candidate perspective. As people look at their compensation, salaries are something that are a lot less negotiated now because you can Google what you should be making and you walk in the door with expectations as a candidate. And if somebody’s not going to pay within that band, you’re going to go somewhere else.

So salary, health insurance have become table stakes. So companies started really differentiating themselves from each other, using employee perks. And then everybody made a big fat mess of employee perks because there’s a perk, everything’s a perk, everything’s a perk.

William Tincup: 02:01 Everything’s a perk.

Amy Spurling: 02:01 And it’s a nightmare for HR and employees are never happy. And so it was just a disaster all the way around but necessary. So it was this weird mix of employees want personalization, they expect to have things that matter to them.

William Tincup: 02:18 Right.

Amy Spurling: 02:19 But if the more things you bring in, the less they’re paying attention and the less they like it. So how do we solve for this? How do we get really good engagement from the team, but also do this in a text compliant way, in a way that isn’t making HR cry themselves to sleep? So that’s what we set out to build was a platform that could work both on the compliance side, but also getting really good engagement from employees, as well. So, that’s what we do here at Compt.

William Tincup: 02:43 I love it. And I love that you’ve been an operator and seen how the sausage is made, especially on the VC side of things. And you’ve seen the other parts of the business that are really, really interesting. Operations is really interesting in and of itself. Finance is really interesting in and of itself. And then obviously, you’re digging in and doubling down on compensation. So I love your background and I love that you’re fixing comp.

It’s really interesting because I’ve done some work in compensation in the past at conferences and have worked with comp professionals. And they have some of the most sophisticated … I know you’re a finance person, so there might not be as sophisticated to you. But for the average people, the compensation spreadsheets are so sophisticated, it’s crazy.

Amy Spurling: 03:40 Yeah.

William Tincup: 03:40 Like they can do crazy things with Excel that I didn’t even know was available to me. And so replacing that with sophisticated software. I think, it’s good for them. And tell us about like the pathway right now and who you’re working with in terms of like, are you working directly with comp professionals? And kind of getting them to switch over from either another type of software or the largest HR software company in the world, Microsoft Office. Like who are you working with? Who’s your targeted buyer?

Amy Spurling: 04:19 Yeah. So the buyer is usually somebody either in total rewards or head of HR or comp and benefits, it depends on the size of the company and what they’re calling the role. Where we play in the compensation space is around that employee parks management piece. So trying to get more inclusivity, reach more people. With an employee perk strategy, the way that usually works or typically works in a company that is usually employee perks, which is most companies at this point in time, because it is that key differentiator for folks as they’re competing for talent, especially now. Is that you go and you bring in a student loan forgiveness provider and maybe a childcare provider and maybe a food and maybe a bunch of different things. But each one of those individual perks that you’re offering, if you’re lucky, 5% of the team uses it. So very, very low utilization.

When you move to a platform like ours, you’re building out employee perk stipends, where you tell employees … and you can do different groups if you want. This location versus that location, if you want to do geographically based compensation or things like that. But you’re saying employee X, you have a hundred dollars this month to spend on wellness and family and student loans. Now for somebody who doesn’t have student loans, but wants running shoes, they could spend it in health and wellness and go buy running shoes.

William Tincup: 05:43 Oh, that’s great.

Amy Spurling: 05:44 But the next month they’re not going to need running shoes. So maybe after that, maybe they want to use it for a nanny for the night, or maybe they do want to put it towards their student loans. But it allows employees to kind of choose their own adventure without being tied to specific vendors. So there’s no vendors on our platform. That’s one of those key differences between us and the others in the market.

William Tincup: 06:02 Right.

Amy Spurling: 06:02 It’s really agnostic. So that if your employee is living in a small town in rural Alabama, they have the same access to their compensation that somebody sitting in downtown Chicago or New York has. And so making it to where it reaches more people in more places.

William Tincup: 06:21 Dumb question alert. Do you see it eventually, possibly on the roadmap of people being able to switch a perk for time off?

Amy Spurling: 06:32 It’s interesting. People are exploring that.

William Tincup: 06:35 Okay.

Amy Spurling: 06:35 That is definitely a question we get asked.

William Tincup: 06:36 Okay.

Amy Spurling: 06:36 I think the entire … or like, I think there’s a big question [crosstalk 00:06:44]-

William Tincup: 06:43 I don’t know how the finance would work. I don’t know how that part would work.

Amy Spurling: 06:44 Yeah, I’m not sure how the finance would work.

William Tincup: 06:44 Okay.

Amy Spurling: 06:44 I think it’s part of why I haven’t seen it put in practice yet, but it’s definitely a conversation that’s happening right now, where people want to do that. Now, if you’re getting a hundred dollars a month, a day off is not worth a hundred dollars. Like, unless you’re making an absolutely like … don’t get me start on the companies who are paying their people a hundred dollars a day, that is not acceptable.

William Tincup: 07:05 Right.

Amy Spurling: 07:06 It could be, you could buy up time is something I could see at some point. Where it’s like, all right, if you’re making $50 an hour, do you accrue two hours of time off for companies that do accruals? Maybe. But I’m not sure that employees would take advantage of that, too. Because the dollar amount is usually a lot lower in employee perks. So think $1,200 to $1,500 a year for a lot of companies.

William Tincup: 07:30 Got it, got it.

Amy Spurling: 07:30 So, it’s not going to be as much.

William Tincup: 07:34 I was going to ask you about market, where positionally is Compt? Or is it SMB? Is it mid-market? Is it high growth? Global? Like, where are we positioned?

Amy Spurling: 07:46 Yes, yes, yes and yes.

William Tincup: 07:49 Yes, William.

Amy Spurling: 07:49 Yes, we do all of those things.

William Tincup: 07:49 Well said.

Amy Spurling: 07:52 Yeah, exactly. What we find is that, because we have a really solid inbound strategy, we get a lot of interest from all over the place. So we are not targeting the world. That would not be a viable strategy.

William Tincup: 08:07 Right.

Amy Spurling: 08:07 But who walks in the door and is looking to make a change crosses industries, we see a lot happening in manufacturing and construction right now, for instance. You see a lot of industries that don’t historically do employ perks, really struggling to retain people. So they’re having to think about it in a new way. We’ve got about 20, 30% of our customer base has an international component, where they’re trying to build a cohesive perk strategy across their entire company. But a portion of their companies sitting in other countries with other currencies. And that obviously other types of benefits that they would like. So we have a lot of folks that come to us for that international component, as well.

And then, the size factor as you start thinking about who finds it most painful to deal with the tax accounting on all of this. The bigger the company, the more painful the tax accounting. So we see it, that if you’re coming in because of the tax piece, it’s going to skew to the higher side, the larger employee base. Versus a company with 10 people, maybe you’re not as worried about the tax piece.

William Tincup: 09:12 So a couple things with the pandemic, as it relates to perks and people being remote or hybrid or return to office or whatever the new model is.

Amy Spurling: 09:24 Yeah.

William Tincup: 09:26 What have you seen kind of how the perk space has changed or how y’all approach the perk space a little bit differently because of what we’ve learned thus far-

Amy Spurling: 09:37 Yeah.

William Tincup: 09:37 In the pandemic.

Amy Spurling: 09:39 We see a few things. One, we see companies using employee perk stipends to influence behavior. So some companies will have multiple stipends, maybe a hybrid, maybe a remote, maybe an in-office stipend. So three different stipends. Now, which stipend gets the most money? Depends on the behavior they’re trying to drive. If they want everybody back in the office, they’re going to put more money on that in-office stipends. So trying to incentivize people. Think about it from the lunch-flation conversation that’s happening right now, where if you’re buying lunch in downtown in a city, it’s a lot more expensive than at your house.

Or if they’re trying to downsize the actual physical office footprint, they may put more on remote to try and encourage people to continue working from home and supporting cell phone and internet in your house. So it depends on the behavior that companies are trying to drive. We see a lot of that happening in stipends. The other thing is the like the shift to stipends period and away from vendors, absolutely took off through the pandemic. I mean, imagine if you had a gym reimbursement, for two years you couldn’t use it. The gyms weren’t open, that’s not helpful.

William Tincup: 10:49 Well, that’s what gym owners want.

Amy Spurling: 10:51 Well, there’s that, but-

William Tincup: 10:54 That’s different.

Amy Spurling: 10:55 That’s a different part of that business model, but you’re right, that is accurate. But with that, that’s where companies were like, “Look, it doesn’t make sense to offer perks that literally nobody can use.” Like, so we need to think about this difference.

So the companies that were started using stipends before the pandemic, we looked at our data off those folks to say, “All right, how did they do through the pandemic?” And what we found is that the people who started with us at least by January of 2020, grew almost 147% from a people perspective in the last two years. So not only retaining their people, but being able to add a lot of head count. So we certainly don’t take credit for that entire phenomenon. But their behavior is very different from what’s happening on the open market. And so that is something that we’re seeing be a key factor for them to be able to hire is that differentiation, that personalization for every employee is a big key factor.

William Tincup: 11:52 I love that. First of all … and I love the ability for someone to just wake up the next week and go, “I want something different.” Which I think is great. Again, if it’s a Starbucks gift card, that’s cool. And if you spend a lot of money at Starbucks, like that’s actually a really cool perk. It’s just less money out of your wallet and that’s fantastic. But not everybody does that and so I love not only the personalized approach, but also hyper personalized to that individual in time.

Amy Spurling: 12:25 Right. Well, it also doesn’t change your spending behavior. If you have a Starbucks gift card, you have to remember to take it out of your wallet.

William Tincup: 12:32 That’s right.

Amy Spurling: 12:33 And what happens when you’ve got $2.30 left? There’s nothing there you can buy with $2.30. So you’re probably going to waste it. So you’re throwing away money. On top of the fact the company had to activate that gift card, which also costs them money. So there’s all this waste that happens with gift cards, where when you move to something like a stipend, the employee goes and spends the money wherever they want. That’s fantastic. In the same way they would typically. And so then it’s just uploading a receipt after the fact of like, “Hey, yeah, I went and got Starbucks last week.” “Awesome. Here you go.” And maybe you bought a bigger order, maybe you had a smaller order. Who cares. But it doesn’t change their actual physical behavior, which makes it so much easier for employees.

William Tincup: 13:12 I love that. Let’s talk a little bit about … let’s shift to the software itself. And I’ll start with some kind of basic things, buying questions that you love and that your team loves, like you just kind of … you know that they get it, they’re thinking about perks differently. You’re not going to be pushing the boulder uphill the entire time. What are some of those questions?

Amy Spurling: 13:39 I love when folks come in and say, “Look, I do not want to tell my team what wellness means. My people are adults. They are on their own journey, their own path. So I’m looking for a solution that allows them to decide what wellness means.” That gets me excited. If a company wants to micromanage and say, “Hey, we only offer this mental health app. Or we only want to think about wellness from a gym reimbursement perspective.” We’re probably not a good fit because it’s not one size fits all. And when you start treating your people like adults, which they all are, you find some really magical things happen.

So that kind of perspective and philosophy at a company, when they come in and say, “Look, my people are adults. I want them to be happy. I want to create a sandbox for them. But how do I do that? How do I do that in a way that allows them that freedom, but allows us to align it with our cultural values?” That gets me really excited and lets me know that philosophically we’re going to be a fantastic fit for them.

William Tincup: 14:44 Do they have a … because of your background in finance, I think I’m going to ask you this question. Do they have an idea of what they should be spending per employee? Or do y’all have like a calculator that can help give them some guidance? Either by industry or otherwise. Because I think that’s always been … at least historically, that’s been kind of a … well, how much is too much? Or what’s the diminished return? And how do I budget for this?

Amy Spurling: 15:16 They have all of those questions.

William Tincup: 15:17 Yes.

Amy Spurling: 15:17 Nobody knows the answer.

William Tincup: 15:18 Okay.

Amy Spurling: 15:19 We do bring data to that conversation because that is … I mean, that’s one of the questions they want. They don’t want to be left behind or be behind what other competitors are doing. But they also, nobody wants to overpay. Like nobody has an unlimited slush fund of cash. So they want to make sure that they’re doing the right things by their people, but they’re also not burning too much cash at the same time.

What’s interesting is that … and the data that we share with them is that it really is much more around the flexibility for the employees rather than the dollar amount. So on average companies are offering their team about $1,200 a year. So $100 a month on average. But we have a lot of companies doing $100 a quarter, getting the same exact utilization. They can still get 90 plus percent utilization. Where 90% of their team is using their perks on a much smaller amount, it’s about the flexibility. So think about it this way. You give your team $20,000 a year that can only be spent on cell phone. You’re not going to be able to spend it. It’s useless.

William Tincup: 16:22 Right.

Amy Spurling: 16:22 Like that is a useless perk. You’re going to use it for your cell phone, but that is what? $100 a month. So you’re going to have underutilized perks. Whereas if you say, “Hey, you’ve got a hundred bucks this quarter that can be used on travel or pets or family or wellness.” You’re going to be able to find something because that’s part of your life. And so you can get much better utilization that way. So we work with them that way to be like, “What outcomes are you trying to drive? Do you really want really high utilization? If you have a bigger budget, let’s talk about how you split this into multiple stipends.”

Maybe you want to have a professional development stipend. You’re not going to want to combine that with food. Those are not two equal things to anyone. If you’re trying to drive professional development, you don’t want them to use DoorDash. So why don’t we put that on its own to where you’re driving a certain behavior. So it’s much more about behaviors and outcomes. And we bring all of that data to the conversation with these HR leaders, because that’s going to be what moves the needle for them on retaining and attracting. So it’s not as much about … they don’t have to spend a lot to be able to do that.

William Tincup: 17:24 So I forgot to ask you, I was remiss in asking you kind the business model. Because years ago, when some of the players came to market, there wasn’t really kind of an agreed upon kind of model. Some people gave their platform away and then made a piece of the transactional things that went through the platform. And some folks don’t do that, that’s more SaaS and kind of an unlimited thing. So without getting into dollars and cents, of course, what’s the business model?

Amy Spurling: 17:54 Sure. So for us, it is a SaaS model. I looked at a bunch of different approaches and ended up ruling them out either because as the buyer … so sitting in the HR finance seat, I was like, “Ugh, the worst. I hated that.”

William Tincup: 18:08 Yeah. Variable calls.

Amy Spurling: 18:10 I’m not going to do that. Exactly. So I don’t love per employee per month. Because as a finance person, you can never budget for that, it’s so irritating. Like-

William Tincup: 18:18 That’s right.

Amy Spurling: 18:18 Okay, we just added another person. I got to remember that that’s going up.

William Tincup: 18:21 That’s right.

Amy Spurling: 18:22 So we do it tiered based on the number of employees when you start with us. But we don’t charge you anymore, you could double in size during the course of your contract, we’re not coming, looking for more money. On renewal, we’ll see how many you have and we’ll figure out your next contract. But it’s just kind of like a fixed fee for that term based on who you have at the beginning.

Which is very different from most books in the market. You’re right, there are a lot … like if the companies that are doing employee perks, but with like a credit card concepts, they’re definitely doing the transaction fee thing. The ones that are doing marketplaces are taking a cut off of the market, as well as charging a fee. So we do operate a little differently. But trying to make it really transparent and clear for the organization.

William Tincup: 19:02 I love it. Thank you so much for clarifying. So last two questions. The one’s going to be around your favorite part of the demo and the other is going to be kind of your favorite most recent customer success story without naming names, of course.

Amy Spurling: 19:18 Sure. So favorite part of the demo is when we get to the … there’s one screen in the platform where you’re building your stipend and you get to pick from all the categories. That’s definitely my favorite part of the demo. Because it’s basically a shopping trip where you get to decide all the things that you’re going to let your team do. So I love that screen. Because you can see HR leaders’ eyes light up, because they’re like, “It’s literally as simple as checking or unchecking a perk to give this to the team.” You’re not piloting new vendors, you’re not finding them, you’re not doing contracts, you’re not tracking it. You’re doing none of that. But you get to do really cool stuff for the team. And that is really exciting to see.

Favorite customer success story, our recent one. So we recently launched a platform … or part of a feature in the platform where companies can allow for peer to peer bonusing.

William Tincup: 20:07 Oh, cool.

Amy Spurling: 20:08 So they’ll give employees … like it’s usually a pretty small budget, think of 1,500 bucks a year to an employee to be able to basically spot bonus their peers. But in doing so, they have to select the employee and write in usually which cultural value the person’s living up to or the cool thing that the person accomplished. And it’s much more about the recognition, obviously, than the dollar amount. But the cool piece on the customer success side is that I’ve spent a lot of time talking to HR leaders about this and the concern is always, “Okay, but what if people are buddies? You bonus me, I bonus you. And we all go out for drinks.”

William Tincup: 20:46 Yes.

Amy Spurling: 20:47 That’s the behavior they want to avoid, obviously.

William Tincup: 20:49 Right.

Amy Spurling: 20:49 Because they’re trying to drive that really cool behavior. And what’s so awesome is a bunch of our HR leaders figured out, they’re like, “Okay, we want to do the peer to peer piece because we want people engaging.” But the only category they’re letting people spend on when they receive that bonus is charitable giving. And that is really special to me. Because you’re not only getting people to recognize each other and giving that happy joy moment to the employee and they’re getting the public recognition. But then as an employee, you get to take those funds and support a cause that is meaningful to you. And that, I think, is a really special way that HR has approached this to think about blocking the bad behavior, but also really encouraging some really cool behavior to happen.

William Tincup: 21:35 I love it. I love what you’ve built. It’s remarkable and I think it’s just going to be … it’s a huge winner. So-

Amy Spurling: 21:41 Thank you.

William Tincup: 21:41 Amy, thank you for coming on the Use Case Podcast.

Amy Spurling: 21:44 It’s my pleasure. Thanks so much for hosting.

William Tincup: 21:46 Absolutely. And thanks for everyone for listening to the Use Case Podcast. Until next time.

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