Salt Labs Raises Additional $8M to Bring Loyalty Earned Assets to the Workforce
Salt Labs is announcing today that Third Prime has invested $8 million in the company through a sole-led seed financing. This brings our total funding to $18 million across our pre-seed and Seed funding. With this new capital, we plan to bring Salt to employers as a force multiplier for employee retention and productivity.
Represented by 76 million workers, the hourly workforce is the backbone of the American economy. We started Salt Labs because we didn’t see any effective solutions to help solve the generational crisis of hourly and frontline workers no longer feeling connected to their work. For years, this lack of connection has created a ripple effect in the labor market and has led to dramatic decreases in productivity, engagement, retention, and financial security for hard working Americans. Our mission at Salt Labs is to enable frontline workers to own the long-term value of their work. We envision a future where workers are able to capture the value of their work beyond their hourly wage, ultimately enabling greater financial freedom and long-term wealth creation.
We are building a first of its kind technology platform that empowers an employee to measure, capture, and ultimately reward themselves for the work they do. Salt is a Loyalty Earned Asset. It is similar to airline miles or hotel points, but with Salt, you can only earn it by spending your most important resource – your time.
Loyalty Program for the Hourly Worker
Loyalty is a powerful behavioral change agent. It is why we choose between American Airlines or United Airlines, Hilton or Hyatt, Starbucks or Dunkin. It not only changes from whom we buy, but it also changes how much we buy: Fly more - earn more miles. Drink more coffee - earn more stars. Spend more - earn more membership points. Salt leverages the motivational design features of best in class loyalty programs but drives ownership-like outcomes because it is connected to work: Work one hour, earn one Salt. Work more hours, earn more Salt. Simple. Easy. And most importantly, effective in creating employee behavioral change.
At its core, someone works a job for two reasons: the first is to make enough to enjoy her personal life outside of work, and the second is to build for her future. It’s really that simple. The challenge is that this core value proposition is often not realized in the context of hourly work. For example, 60% of Americans are spending 102% of their paycheck.* After all of those expenses are paid, they have less in their bank account than with what they started.
Loyalty Earned Assets
Through our technology, we have created a completely different experience for Salt users. Workers now have a Loyalty Earned Asset (LEA) that they can save. Over time, an employee’s Salt balance becomes a store of value. They see their balance increase over time and then have complete freedom and choice as to how they spend that Salt - for example, for aspirational experiences or financial resources like savings products. Through Salt, work finally becomes what work was meant to be: a way to enjoy life and a means to build for the future.
Most importantly, employees highly value Salt. Unlike a traditional loyalty program where points are earned by spending more money (e.g. buy more coffee to earn more points), an employee can only earn Salt by working. In this way, her Salt represents the output of her work and as such, the employee ascribes meaningful value to it. From an employer’s standpoint, Salt has an outsized retentive benefit as employees are motivated to earn more of an asset they find extremely valuable. The turnover rate for Salt users is 72% less than the turnover rate for non-Salt users. That is astounding, but easily explainable: in the same way that you probably won’t change your airline carrier once you are a part of their miles program, most employees are reluctant to change their job once they’ve started earning Salt.
After getting to proof of concept since launching six months ago, we are now onboarding world class employers to Salt. These are companies who believe that Loyalty Earned Assets will be an essential part of the employer/employee relationship. These companies now have the first mover advantage of what we believe will become the next inexorable trend.
As a company, we at Salt Labs are deeply committed to our vision to create asset ownership for hourly workers for the first time ever, and in the process, to radically change and enrich the employer-employee relationship. We have already partnered with some of the investment community’s best minds on our journey, and are now grateful to partner with Third Prime on our next leg.
PS: We want the best and brightest to come build with us. If that’s you, email email@example.com.
*Goldman Sachs Global Investment Research, 2020