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ASP - Wednesday, November 9, 2005

WageWorks - Profile

WageWorks = SalesForce - 3 years ago {Benefits Market}

Founded: 2000

HQ: San Mateo, CA

Management: Scott Halstead is CEO and he was previously CFO. Before that Halstead was COO and CFO for eBenX, a publicly held health and welfare benefits administration company.

Investors: WageWorks has raised over $30M in VC funding from Advent International and VantagePoint Venture Partners.

Business Model: WageWorks administers voluntary employee benefits like health-savings, COBRA, and flexible-spending accounts. WageWorks is riding a trend where employers are giving their employees more benefit options and need to explain and administer these options - which it outsourced to WageWorks. The company operates the site ForYourFinancialHealth.com to make this happen. WageWorks reported revenues of $14.4M in 2004 and a 2100% revenue growth rate between 2001 and 2004. It has made several recent acquisitions: HCap Strategies, FBD Consulting, Sodexho Pass, and FlexBen. Clients include over 75 of the Fortune 500 including: Bank of America, The Bank of New York, Leggett & Platt, Limited Brands, Pfizer, Tribune Company, Union Pacific, and The US Postal Service.

Competitors: May but heads with the likes of Employease.

Dirt: WageWorks is doing it right. The company's offering is becoming a must-have for companies that want to treat their employees well. Its biggest problem is not sales but hiring good customer support - we assume they treat their own employees with respect.