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GuideSpark raises $5M to untangle the web of employee benefits

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GuideSpark has secured $5 million to help employers and their employees maneuver the complicated landscape of health benefits.

The Affordable Care Act is kicking into gear on January 2014. Health reform will change the landscape for employee benefits. People will have a more choice when it comes to health care, and this creates a need for education that helps them understand their options.

GuideSpark claims it can help you understand health care reform in three minutes. The company has a series of videos that inform employees on changes that will impact their health coverage as well as customized benefits and open enrollment. Its strategy is to take a popular web medium — short, engaging videos — and instead of showing cats doing cute things, conveying important information about health care. GuideSpark also has content for new hire training and financial wellness.

“The web is dramatically changing how users get, find, and consume information — from YouTube videos, blogs and Twitter feeds to social networks and online applications,” the company said on its site. “These recent information trends are becoming an everyday experience, and that experience is carrying over to the corporate world where employees are beginning to expect the same types of information experiences to engage and educate them. HR organizations — who are responsible for most employee training and communications — are not prepared to keep up with these accelerating communication and training trends.”

In a statement about the funding, GuideSpark cited a study from Bersin by Deloitte that found that organizations invest $720 million a year on employee engagment programs, which is roughly half of the $1.53 billion they are projected to spend. Employee engagement and informing them of the benefits is generally the job of HR departments, and GuideSpark’s videos could take some of that workload. Companies that work with “consumer health engagement,” meaning they help consumers find and choose the health care options that are right for them — raised a total of $237 million in 2012, representing the largest chunk of digital health investments. GuideSpark takes a different approach, by focusing more on HR education than providing specific data and comparisons (like Castlight Health), but interest in products and serv

The Menlo Park, Calif.-based GuideSpark works with companies like Adobe, 7-Eleven, SurveyMonkey, and LeapFrog along with the city of San Antonio. This financing will help the company support its existing customers, as well as grow its base of clients. Storm Ventures led this first round, with participation from IDG Ventures and returning early investors.

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