YouEarnedIt, which lets companies create programs where employees reward each other with digital points, has earned a reward of its own: its first round of venture capital.
The fast-growing Austin company said Tuesday it has raised $6.5 million to expand its platform and accelerate sales and marketing. It also plans to double its 50-person workforce this year.
“We’re really excited because this has been a long time coming,” said CEO Autumn Manning. “We have toyed with the option of raising money through VCs, and we had been offered term sheets in the past, but passed on them because the timing or market wasn’t right. This time, the timing and the partners couldn’t be better.”
YouEarnedIt received the the Series A investment from Austin-based Silverton Partners and San Francisco-based IDG Ventures USA. The company previously received seed investment from backers including Motley Fool, Social Starts and Capital Factory.
The idea for YouEarnedIt came about 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 you YouEarnedIt in 2013.
Shortly after launching, the company moved from Arkansas to Austin, drawn by the region’s startup-friendly environment and its talent pool.
YouEarnedIt’s platform 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 be redeemed from an online catalog with items chosen by the company.
While many companies offer gift cards and prizes like tablet computers or dinner at high-end restaurants, many employees choose to pool their points for team activities, or they give them away, Manning said.
“As you earn points, you can store them up and redeem them for something that’s rewarding. For me as a working mother, I could redeem my points for extra time off. Or engineers could pool points for a Nerf battle,” Manning said. “I can also contribute my points to a co-worker in need or my son’s classroom.”
Some of the company’s 300 customers, including Austin-based Whole Foods Market, Hasbro and Anheuser-Busch, get creative.
“At one company, you could redeem your points for executive coaching from the CEO,” Manning said. “At another, you could use your points to have the CEO come mow your lawn all summer.”
YouEarnedIt doubled revenue year over year, Manning said, and growth is being driven by companies seeking ways to retain top talent and appeal to millennials.
“The amount of money employers are spending on benefits is increasing, but millennials still say ‘I’m probably not going to be at this employer in two years unless something changes,’ ” Manning said. “Millennials have forced the conversation. They realize ‘I can get more from my employer, I expect more and I can give more.’ ”