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Motley Fool invests in Austin startup YouEarnedIt

Posted April 13th, 2016

First, the Motley Fool was a customer of Austin startup YouEarnedIt.

Now it's an investor.

The  financial services company has made an investment in fast-growing YouEarnedIt. The amount of the investment was not released.

Founded four years ago, YouEarnedIt lets companies create programs where employees reward each other with digital points, which can be cashed in for prizes such as gift cards, dinner or activities.

Its roster of 275 customers includes companies includes The Weather Channel and Conde Naste.

The company doesn't disclose financial information, but CEO Autumn Manning said revenue grew 150 percent in 2015 from the year before, and is expected to grow more than 200 percent this year.

The investment from Motley Fool adds to YouEarnedIt's firepower, Manning said. With the new money, the 35-person company plans to double its engineering and product teams.

The investment was YouEarnedIt's idea. The company, which previously raised $1.5 million in seed money, had received offers from venture capitalists wanting to participate in its first formal round of funding.

"But we decided to approach Motley Fool, and they were excited and said yes," Manning said. "It's a perfect fit because they are consistently known to be a top place to work, and their philosophy on how you engage employees has always been very much aligned with ours."

Motley FoolThe Motley Fool was founded in 1993 by brothers Tom and David Gardner

In addition to the investment, Motley Fool has become a strategic adviser, and is working with YouEarnedIt on product brainstorming, Manning said.

The idea for YouEarnedIt was hatched in 2011 at digital agency Rockfish Interactive, based in northwest Arkansas. Rockfish CEO Kenny Tomlin wanted to create a program to help reward and retain his employees. After getting interest from clients about the program, he spun out YouEarnedIt in 2012.

Shortly after launching, the company moved from Arkansas to Austin, drawn by the area's startup-friendly environment and its talent pool.

YouEarnedIt's web and mobile service works like this: Employees receive a certain number of points they can give to their peers, along with kudos, when they want to say thank you or recognize work. Points can then be redeemed from an online catalog with items chosen by the company.

What customers learn, Manning said, is that it's not really about the prizes.

"Most companies assume employees want cool rewards," she said. "But what they really want is a better way to connect with each other and to feel a sense of purpose. They are saying 'If you would just recognize me in real time, for all the work I put in, that would mean something.' "

Although many companies offer gift cards and high-end prizes rewards like tablet computers or a dinner at an expensive restaurant, many employees choose to give their rewards away, Manning said.

"Most people, when given the opportunity, will look for ways to give back to each other or spend time with each other, or send their points to their kid's classroom," she said.

It's that phenomenon that drew Motley Fool in as an early customer and now as a financial backer, said Tom Gardner, Motley Fool co-founder and CEO.

"We have invested in YouEarnedIt because they have a higher calling and an expansive vision for helping organizations to value, reward, and develop their teams and employees," Gardner said in a written statement. "We have also invested because it has been obvious -- from our first interactions forward -- that we have kindred thinking about what needs to be done to reverse the grim statistics around workplace satisfaction."

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