Comcast Invests in Major Market Need
Brightside is a financial wellness organization that works with businesses like Comcast, its anchor client, to help employees make sound financial decisions, get out of debt and increase cash flow.
King discusses how the new field of financial wellness is tied to health benefits and how stress induced by money problems can impact employee health.
Generally, about one fifth of folks in America who have a 401(k) have a loan on it. Lots of people who look at 401(k) balances in the United States find that the amount of assets under management continues to go up, but I’m not sure people are peeling the onion back to see the distribution of those assets. A huge number of folks have 401(k) loans outstanding, and the growth in investments is disproportionate across populations.
Around the time of the Comcast study, I was building out the financial technology investment practice for Comcast Ventures when I met and started working with Shawn [Shawn Leavitt, senior vice president of Comcast’s Total Rewards program]. Shawn was saying then that financial stress is one of the next biggest things in benefits…and something that would reduce healthcare costs as much as anything out there.
Comcast, as an innovator in this market, can be a huge force for good and have a major impact on the benefits market as a whole. And Comcast and our other customers will be regarded as innovators and champions for their employees in the market.
Working closely with early customers is super valuable for companies like ours. Especially with a company like Comcast that is so in tune with its employees’ needs. It helps build the right solution in the market. Instead of an employee benefits company thinking they know the needs and building a solution in isolation, we built trying to understand what an employer needs from the ground up. It’s a purpose-built solution.
Second is indirect costs. If someone does get sick and wants to use the healthcare system but has a $2,000 deductible—most people don’t have $400 saved in a bank account—they won’t engage in the healthcare system in a timely manner. Because of this, they inevitably have larger healthcare expenses down the road.
Third is the ability to impact utilization of employee benefits. We engage with a lot of employees regularly, and we can look out for early warning signs. If someone is getting, or might be getting, sick, we may be able to identify it through personalized interactions. If someone is chatting with a Brightside financial assistant, they might pick up that the client has back pain. Brightside is integrated with their employee benefits, and the financial assistant might refer someone earlier to whatever benefits the employee has to improve healthcare outcomes.
A lot of employers do know that, though, and are trying really hard to figure out how they can make a difference there. There’s a huge amount at stake, and if we don’t get it right, families can end up struggling even more than they already are. It’s a really important time in the economy right now, and we have to get this right and make sure we do the right thing for American families. That’s why we started this business: to help families. And this is really a unique time to do it. There are amazing solutions out there that can add value, and technology and research that can have a big and meaningful impact.
The other thing they can do is go down the path of working with some of the point solutions that are out there. They can go out and curate their own set of services from groups like student loan vendors, savings accounts and personal loan companies. The challenge here is that each of those vendors is motivated to sell their own product even if it might not be in the employees’ interest. And when an employer chooses one, they are saying they are endorsing the one they think is the best. Employers have to get up to speed on a complicated sector and then have to implement and manage 20 different vendors.
For instance, student loan refinancing is an amazing option for a certain cohort of the population. They can refinance and can save huge amounts of interest, and it is the right thing to do. But when they do it, they lose that governmental protection [like guaranteed repayment options and protection from harassment or abusive debt collectors]. It can be dangerous to refinance if employees have certain financial circumstances. But when an employer offers it, it’s implicitly saying employees should refinance and use a particular vendor.
One of our clients we found out was contributing 16% of her income to her 401(k) plan and called in because she was getting evicted. It turns out she had $50 in savings. We know it’s a good idea to contribute to 401(k) plans, but it’s not exactly right for everyone at every time. She had received marketing materials telling employees to contribute, so she did. But she probably needed to get $500 in an emergency savings account in case something came up and she couldn’t pay rent.
With all of these options in the financial services space, it’s hard to deliver personalized marketing to an employee base. But having a centralized engagement platform can solve these problems. An employer can see a huge ROI, reduce healthcare costs, and put their hand on their heart and say they have done the right thing for their employees.
But we work on such a full spectrum of things. We have helped people who are living in their car move someplace stable. We’ve helped people who have been evicted and assisted people in paying for their cell phones. We’ve helped reduce employees’ payday loans and helped people find money to pay for a family member’s funeral services. When someone had a fire burn their house down, we connected them with the Red Cross to get $500 in emergency funds so they could find shelter.
To do this, we work with a variety of partners on our platform, including lenders, banks and a wide range across the financial services spectrum. We help people navigate the right resources at the right time.
For employers, scale is a benefit beyond ROI. We have a network effect with hundreds of thousands of employees. If you have 5,000 employees and want to negotiate a financial solution deal, you won’t be able to get one like you do when going through a large platform.
There is also some expertise and work required to identify the different solutions—which are best and which you might want to implement.
For the vendors offering solutions, it is good as well, because they can just work with one platform and get access to a huge number of employees.
We do deliver comprehensive reporting back to the employer, which gives them insight into their population. We give aggregate reporting so the employer knows how Brightside is delivering results.
Providing these services in the workforce is important. Healthcare is driven largely through employers, and financial services is going to be going through the employer channel as well. We are working with innovative employers who want to see what that looks like.