This year, BenefitHub celebrates its 25th anniversary. Vice Chairman of the Board, Seif Saghri, founded the company in 1999 with the purpose of providing people at all companies with the same perks enjoyed by employees at Fortune 500 corporations. After 25 years as CEO, and after the sale of the company this Spring, Saghri transitioned into a new role as Vice Chairman. To celebrate the 25th anniversary, we take a step back into the past to learn more about what BenefitHub has accomplished over more than two decades of making lives easier for employees across twenty countries.
A blast to the past
Q: What inspired you to start BenefitHub? Was there a specific moment of inspiration, or a growing sense of something missing in the marketplace?
Saghri: There are two parts to this story. Firstly, I have a history of founding companies whose business models were aggregation plays, where we conglomerated thousands of small businesses to gain the same purchasing power as a global company. While running those startups, I was never able to get the same great perks and voluntary benefits for my employees that the big companies like banks were able to get – such as discounted movie tickets and gym memberships. I was frustrated about the lack of accessibility for smaller companies and thought of how to deliver such a solution by applying the aggregation model.
Secondly, the Internet was a new phenomenon in the 90s, and therefore we came up with the idea of putting these employee discounts online and allowing companies and their employees to login and access them. By delivering client branded sites for each company, we very quickly reached 100k employee users. What we did differently than the big banks was to incorporate technology at the very core of our offering. This meant we had a very sophisticated virtual discount marketplace versus the single HR-created webpages that were standard at the time. Once we got going, many of these big companies saw it was a superior and free solution and very quickly transitioned to using our platform as well. This is when we really started winning big clients, including 5 of the top 10 largest employers in the US.
Q: What did the Employee Benefits industry look like 25 years ago? Did employers see the value of a virtual benefits marketplace? How has it changed over the last two decades?
Saghri: Worldwide, we were the first in the industry to launch an online perks solution for employers, globally. The only alternative was for companies to manage their deals and offerings themselves. We started with only around 20 deals – though we now have thousands – taking a lot of work off the plates of those HR teams who were struggling to manage those merchants or keep employees up-to-date on the latest discounts.
In 1999, we were also a pioneer of Software-as-a-Service – until the early 2000s, most people were downloading software or handling deals off-line. Within a couple of years, a few other competitors cropped up copying the idea. The benefits industry back then was all about core medical benefits, so we were the beginning of solving these problems for employers who wanted to offer discounts or voluntary benefits to their workforce. It was around this time that the whole industry began to recognize that employees wanted more than just core medical benefits, and I’m proud that we were on the forefront of tackling those challenges.
In the last 10 years, the big change has been that over time those same core medical benefits have become a commodity – in effect table stakes offerings that employers must provide if they want to attract talent. So today, to differentiate yourself when recruiting, you have to offer other benefits. The challenge of course is where to find those attractive deals, and how to communicate the benefits. This big shift to non-core benefits and more personalized employment packages has truly revolutionized the industry. That is another thing that is now core to BenefitHub – true personalization using AI.
Q: Were there any unexpected developments over the course of the company’s history?
Saghri: Yes, a number of them. Already, going beyond retail discounts into voluntary benefits has been a huge shift. We started with getting serious about insurance and realizing that we can deliver home and auto insurance by operating as a licensed insurance agency. It was an unexpected addition that has been great and performed very well for us. Another unexpected thing – we originally never thought we would be able to service really big clients, but it turns out they need us. We currently service 34% of the Fortune 50, and 5 of the Top 10 largest employers.
While it is easier to put limited resources towards our core market of larger corporations, I do expect we will also continue to focus on servicing smaller companies, where nearly 50% of all workers in America are employed. No one in the market is really tackling that segment successfully.
Q: How has technology changed the company from your original vision?
Saghri: What has changed over the years has primarily been the ability to write programs for complex solutions – it has become much easier and faster. What used to take months to develop now takes days. We also currently use 3 AI engines already on our platform, which is a pretty radical change. Another big thing that changed – when I started BenefitHub, all solution providers like us had their own data centers and servers. Now everyone is in the cloud.
Reminiscing on successes
Q: How was it received when you started transitioning to targeting bigger companies? Was it an easy sell? Did you face any challenges?
Saghri: Once we landed our first jumbo client, huge employer and bank Citi Group, which had over 200k employees, it became much easier to win other large companies as we were able to easily allay any security concerns. Of course, security concerns are even higher nowadays, which makes selling to large organizations more difficult despite advancements in cybersecurity. And of course, once we landed a few Fortune 500 companies, we became a very attractive provider. It also helped that for a while, we were the only company in the market.
Q: Which element of the company are you most proud of?
Saghri: There are several elements that come to mind. Firstly, is that we were the first into the market, and that we consistently remained the market leader. I am also very proud that we have 34% of the Fortune 500 as clients. I think there are very few companies in the world that can claim that. Winning the biggest and most demanding clients in the world – those are not easy clients to win, service, and maintain, and we have done that without a roadmap as we were the first. Lastly, I am proud of the really great team we have built over the years. Of course, I also made thousands of mistakes, but throughout all of that, we have continued to grow our team as well as revenue for each of the years we’ve been in business. We are very fortunate that we never had a down year, even during the 2008 recession or the COVID pandemic.
Q: If you could go back, would you do anything differently?
Saghri: Of course, there are too many misjudgments to list here. I would have liked to have avoided the thousands of mistakes that come with the territory of being a startup. Even then, that lost time and revenue were learning experiences.
Looking ahead: to infinity and beyond
Q: If you had to guess, where would you see the industry and BenefitHub in another 25 years?
Saghri: Personalization is already very important, but my prediction is that it will become more and more critical. Until the last couple of years, employee benefits were very much “one-size-fit-all” where you give everybody all the same offerings. My point of view with this is that companies, especially big ones, have such diverse populations that you can’t possibly satisfy everybody by doing a blanket approach. Different demographics, like age, gender, family status, etc. truly create different preferences and needs. And now, with the huge proliferation of benefits and offerings, there is so much out there than you need to put what is relevant to your users right in front of them, otherwise it gets lost. On our own platform, we went from dozens to thousands of deals, which is way too much to wade through. So once again, not only do discount providers need to personalize offerings, but they need to bring the relevant offers to the forefront. And even now, most benefit providers are still not doing enough personalization.
That may change shortly with the broad adoption of Artificial Intelligence. I predict AI will have a huge impact on personalization, and everything else. Employees can tell the AI assistant exactly what they are looking for, and it will populate the best offerings for their specific needs. Even if employees don’t specify what they need, the AI will be able to make a very informed guess as to what will interest them. This will be much more sophisticated than what has been used over the last 25 years. A good example of this is Amazon, and how they have shifted from being a bookseller to having millions of products on their platform. Despite that, as long as they continue to surface products that are relevant and start suggesting based on previous searches and thousands of other collected data points, Amazon shoppers will always be highly engaged. A good AI plus good search functionality is the future. That, and continuously adding more benefits in order to satisfy the needs of all workers.
Q: What about diversifying into other categories beyond ecommerce?
Saghri: BenefitHub will likely maintain its ongoing founding principle – that we are here to bring value to people. We care about employee wellness – which is why I expect us to continue to extend further into the two huge categories of financial wellness and health wellness. There almost isn’t anything we shouldn’t have on our platform that is providing discounts, and helping employees save money and improve their lives.
Q: What’s next for you as you transition to Vice Chairman of the Board?
Saghri: My role now is much more strategic. Rather than running the day-to-day business as I did as CEO, I will now focus on strategy, supporting our new CEO, and looking further afield for fresh ideas. Now that we have the backing of private equity firm Inverness Graham, there are a lot of new and exciting opportunities we are looking at, including the recently announced acquisition of Abenity, a US provider of private perks programs.
I also plan to be more actively involved with Voluntary Advantage, the market’s leading voluntary benefits association, where I am a board member.
Seif Saghri is a seasoned entrepreneur and accomplished CEO with a proven track record of founding and leading four successful startups to exit. Most notably, he founded BenefitHub in 1999 where he served as CEO, growing the company into a global leader in employee discounts and voluntary benefits. Under his leadership, BenefitHub expanded to over 10,000 clients across 20 countries, including 32% of the Fortune 50. Following the recent acquisition of BenefitHub by Inverness Graham, Seif now serves as Vice Chairman on the company’s Board of Directors, continuing to help guide its strategic direction.
Check out BenefitHub’s 25th Anniversary collection here and contact us to learn more about our celebratory offers and deals!