When my wife and I left the hospital in May with our second child, we were thinking about paperwork. As we walked out of our recovery room, our arms were full of baby bottles, pacifiers, baby clothes and blankets, but also a birth verification letter which we knew would be important for our parental leave processes — a form we had forgotten for our first son that subsequently created a huge headache for us down the road. I remember feeling frustrated that at such a special moment in our lives I was having to play the role of household bureaucrat.
When an employee goes on leave (parental, medical or bereavement), the government offers paid benefits to cover some time away from work. In practice, getting access to these benefits is extremely complicated and requires a lot of sophistication and paperwork on behalf of both the employer and employee. Both parties need to navigate a web of bureaucracy (federal disability laws, state-by-state disability and paid bonding leave regulations, doctor certification notices, coordination with payroll providers, etc) with the end result being a headache for all involved and oftentimes an incorrect or missed paycheck.
Nearly half of all employees will take a leave at some point in their professional lives. That process should be about taking space and time to be away; not being mired in a web of high-stakes paperwork that can cost you a paycheck. This is a big problem for HR teams as well as employees. When we surveyed the Index portfolio earlier in the year, this topic emerged as "one of the worst HR processes around."
"...this was a clear example of A+ founders attracting the brightest stars from across the tech ecosystem to join them."
— Mark Goldberg, Index Ventures
This is where Cocoon comes in: eliminating the headache from leave for employees and employers alike. Think of it like TurboTax for leave. Employees can plan the details of their leave, compare their pay options in different scenarios, and manage their leave with their employers in as little as 10 minutes. For the employer, what was a painful process becomes a brand-positive experience. When employees can easily manage the process they're grateful to their employer. Employees can set it, forget it, and enjoy life until they get back to the office.
Tackling a challenge this impactful and widespread is an exciting opportunity, and we knew from day one that Cocoon's co-founders, Mahima, Amber, and Lauren were just the team to tackle it. I've written previously about the power of Talent Vortexes, and this was a clear example of A+ founders attracting the brightest stars from across the tech ecosystem to join them. From a cold start to over 20 employees this year, they have one of the highest offer acceptance rates we've ever seen and have been blown away by the quality of candidates from Stripe, Square, Gusto and many other fabulous networks.
"While much has been written about the shift towards remote and hybrid work, the bigger trend in the future of work is going to be the ways in which employers embrace the humanity of their workforces."
— Mark Goldberg, Index Ventures
While much has been written about the shift towards remote and hybrid work, the bigger trend in the future of work is going to be the ways in which employers embrace the humanity of their workforces. Creating a seamless path for employees to transition in and out of life's most challenging moments will lead to more vibrant, engaged, and loyal team. Employers who embrace workers as humans and not cogs will win the coming war for talent. Cocoon is becoming a critical tool for these employers, and we couldn't be more excited to lead Cocoon's $20M Series A just a few months after leading their $5M seed round earlier this year.
Published — Sept. 29, 2021