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Venture capitalists looking for a solid investment and employers looking for a competitive edge are looking in the same direction: family-friendly benefits that support new parents at work.
Maven, a women’s and family health company and digital benefits platform announced last month that it had raised $27 million in Series B funding with venture capital firms Sequioa and Oak HC/FT, for a total of $42 million raised since 2014, according to an announcement from CEO Kate Ryder. Maven provides workplace benefits that include on-demand access to fertility experts, pregnancy and postpartum specialists, and back-to-work coaching for new parents.
“Investing in these benefits has become a priority for employers,” Ryder told Bloomberg Law. “The reason we have so much interest in this fundraising compared to four years ago is that companies are starting to understand there is a genuine leadership gap at the top, and many women drop out of the workforce after having children.” Maven’s clients from the technology, law, and banking industries see these benefits as a talent attraction and retention tool, she said.
As employers realize this return on investment, so do venture capital firms. “Our goal is to find very, very large dent makers who are changing the world and partner with them as early as possible,” Jess Lee, a partner at Sequoia Capital, told Bloomberg Law. “For this investment, we were thinking about health care and women’s health being an interesting opportunity.” Sequoia’s list of past partnerships includes Google, Yahoo, Airbnb Inc., and DoorDash.
Lee said interest in investing in family- and women-centric health benefits platforms is due largely to women’s decision-making power in both household purchases and health-care choices. “Women end up becoming essentially the chief medical officer of the household once a child comes into the equation, usually,” Lee said, and “this makes women’s health a very interesting business proposition.”
Maven isn’t the first digital health benefits platform for women to attract the focus of VC money, but it’s one of the first to provide a larger suite of benefits for employers to offer workers. Traditionally, benefits for egg freezing, fertility consulting, lactation expertise, and other maternity-related health needs were siloed into individual companies.
But there was interest in funding those ventures as well. For example, Progyny, a New York City-based digital health company that specializes in fertility benefits, secured $14.7 million in Series B funding in 2016, and another $10 million the following year.
Changing workforce demographics show why there’s increased funding for these kinds of ventures. More and more women are in the workforce, reaching the stage where they start families, and maternity is often a top three cost for employers, Lee said. “If you don’t proactively manage those pregnancies—especially high-risk pregnancies—it can get very, very expensive.”
Parental leave is the most expensive benefit that PricewaterhouseCoopers LLP offers in its group of family-friendly benefits because about 2,000 employees a year take the leave, Jennifer Allyn, diversity strategy leader at PwC, told Bloomberg Law. But the consulting firm offers benefits far beyond the realm of traditional leave, including surrogacy and adoption reimbursement benefits, emergency back-up child-care reimbursement benefits, lactation consultation services and accommodations, and breast milk shipping for nursing women on work travel, she said.
Family-centric benefits that support working parents are some of the “most critical” benefits the company offers, Allyn said. “That is a huge life event that is extremely meaningful and you need that time off and support.” Comprehensive benefits, however, are not a silver bullet to keeping employees, and especially women, in the workplace, she added. “People still leave due to work-life balance issues.”
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