Every time you start a new job you may have enroll in a new 401K account and gain access to any new stocks provided by the company. Of course, you also need to stay on top of your personal debt, your children’s future education, and your retirement. What if your employer could help balance your financial health with a coaching resource that not only handles your work finances, but everything else too?
After a stint on Wall Street and at his own hedge fund, David Stedman realized that the average employee doesn’t have nearly enough access to essential information about money and how to manage it. In early 2014, he shuttered the hedge fund to jump into the startup world by founding BrightDime (then called Canopy).
“What I wanted to do was figure out a way to give all the resources and education and energy that the wealthy people were getting, and provide that to your average person,” says Stedman. “I made a pretty rash decision and closed the hedge fund down and started BrightDime.”
Despite having nailed his elevator pitch early on, Stedman was dissatisfied with the original branding of the startup — often the one factor that prevents a good product from clicking with customers.
Initially, BrightDime was called Canopy Financial Advisors. Stedman says this was a misguided name, as the company was never financial advisors, but instead coaches. Stedman recently made the name change and has seen instant gratification.
“It’s a much more memorable name. It’s a very searchable name. We look at it as a name that talks about a bright future for your average person,” says Stedman. “We thought BrightDime was a better way to express what we were doing.”
The North Carolina startup ties employee wellness with financial health. According to a Consumer Financial Protection Bureau report, 71 percent of employees say that uncertainty about money is the biggest stress they face in the workplace. Of those surveyed, 20 percent of employees admitted to skipping work in the past year to deal with financially-related stress.
BrightDime hopes to take that stress away by providing you with financial coaches and mentors to help you get on solid financial ground and empower you to do more with your money.
Users share a high view of accounts, from student loans to savings and retirement funds, with their financial mentor to start learning how to make smart decisions about their money. It’s all done through a secure in-app chat window.
“We believe that the way we deliver coaching is very unique,” says Stedman. “We provide a comprehensive financial wellness experience, but one of the pieces of it is coaching. From surveys, particularly with millennials, there’s become a much bigger drive to not meeting face to face, not talking on the phone, but doing it through a chat window.”
The most-common problem the coaches see is related to student loans — whether they should extend their student loans or pay their consumer debt first. That’s followed by the question of how to save enough to buy a house.
“Our platform has a very interesting way that we present budgeting to the user,” says Stedman. “One of the big things that stops people from creating a budget is that they don’t know where to start. We can show them where they’re spending money and we create a budget for them. The bottom line is that we get them started. Through that budget, we can help them focus on their credit.”
The platform, paid by the employer, can stand alone or integrate with an existing internal interface. It’s on a “PEPM” revenue model — per employee per month. Their roster of clients includes small businesses up to corporate level enterprises.
Stedman says that most employers prefer for them to be independent as employees trust the platform more. In the end, the platform and coaching resources can help reduce employee financial stress and help them channel that energy into their work.
“One of the neat tools that we give the employers is a way that they can calculate the ROI of our services,” says Stedman. “They give us their assumptions and we’ll put it into our ROI calculator and let you see where we think we can make a big difference to your employees. That goes from productivity to absenteeism to reduction of stress and financial costs and others.”
The startup raised a $1.7M Series A round in January to expand their product development and add more people to their sales and development departments. Stedman shares that they are fully focused on growth now.