Jacob Sheridan is the Co-Founder and CEO at TPA Stream, an insurtech software company that’s building solutions across the employee benefit industry. Jacob was interviewed by Andrew Daniels, Founder and Managing Director at InsurTech Ohio.
Jacob, how have your experiences led to your focus in the employee benefit space?
“In 2012, I had the opportunity to work for a growing innovative software company in the Cleveland area called OnShift. I was really excited to work for a technology software company. I wasn't as familiar with the healthcare and nursing home space, but I was intrigued with what they were doing, how they were adding value and leveraging technology and healthcare. I was hired for an entry-level sales role. Over the course of four years, I grew with the company through promotion,, expanded my responsibilities and learned about the healthcare space, technology solutions and the challenges around data and integrations.
More and more point solutions were being developed and created, and they needed data from the systems of record, administrative systems and core processing systems. Building those integrations was hard to do. If you were able to integrate with another system, you likely could close business. You would typically have a lot of success from a sales standpoint, but without an integration, you could not close the sale. We found that the deals did not get through the finish line if we weren't able to provide an automated integration. When I was at OnShift, I learned the power of integrations, and I correlated integrations to revenue and commission. I took it upon myself to get more of these integrations built. How did I do that? Well, I became best friends with the Integration Manager at OnShiftwho is now Chief Technology Officer (CTO) at TPA Stream, Stephen Furhy.
Also, I started calling companies that we needed to integrate with. Instead of calling people that would build integrations, I called the CEOs. I had a lot of success doing that. What we've learned over the years is that if a point solution is valuable, you might be able to get potential customers to move the other systems that they use, so they can use your point solutions. That's how valuable these integrations were. That's really where we started. I started learning about healthcare and the intersection with technology and data and integrations, which then has led to what we've built at TPA Stream.”
How’s the industry evolving, and how have technology innovators changed to adapt?
“We're really focused on the employee benefit space, and we've done a lot of work integrating with pre-tax (also called CDH, or Consumer Directed Healthcare) and COBRA (Consolidated Omnibus Budget Reconciliation Act) administration platforms. We're now expanding and integrating with medical, dental, vision, supplemental and all of the other platforms used across the employee benefit space. What we continue to see is point solutions.
We continue to see all of these cool tools and innovations out there that are siloed, sometimes integrated, sometimes not. Look at a small business today, and the number of point solutions they're using is outrageous, whether it's for employee benefit purposes or other components of their business for communication, email, customers, sales, accounting, development and customer service. We’ve seen a lot of innovation from a point solution standpoint, and we see the next chapter will be consolidation and being able to provide a single platform that can integrate with point solutions and provide capabilities directly to clients.”
What’s the current state of digital transformation in this part of our industry?
“Looking at the employee benefit space today, there are a lot of insurance companies, and the majority of them have built nice businesses. They've figured out how to create a margin and grow the top line. What they're realizing is that – especially in our current economic climate – they have very inefficient systems and departments of people. One of the themes that we're seeing for 2023 is efficiency. 2020 through 2022 was all about revenue growth and expansion. Now, businesses are focusing on efficiency. What's really interesting is that we're seeing more and more organizations looking at digital transformation and ways to consolidate systems and data to be able to provide better experiences for their clients.
We have a product called Employer Invoicing where we can help integrate with various systems that are used in the employee benefit space and help our customers, who are administrators that serve employers, create a single consolidated bill for their clients. Through that process, the act of consolidating all of these different systems is helping to provide a better, more cohesive experience for these administrators' clients. They're also able to reduce an extreme amount of administrative workload by using that tool. It's one of the ways that we're helping organizations start a digital transformation journey just through a simple concept of invoicing. We see that organizations across the employee benefit space are trying to start the process of digital transformation. A lot of them don't necessarily know if they should build or buy a system.
How do we do this in the employee benefit space? We're grateful that the solutions we're building are turning into something that can help solve problems around experience, integration, data and administration.”
What’s your vision for the future of this space?
“We're excited to see more consolidation and fewer players providing more products, better quality services to small and large employers alike. Health and wealth are being mashed together in really unique ways. I really look at it as asking, ‘What do you want as an employee?’ If you're an employee today and you're taking advantage of all these employee benefits, you don't care that there are a bunch of brokers involved to set those up. You want to see all of your benefits in one place, and you want them to be easy and work well together. In order to provide that level of experience, these organizations and the health and wealth space across employee benefits are going to have to consolidate all of the data across their systems. They're going to have to decouple administration and data.
Organizations have to leverage that data across their company to drive growth and provide better products and services utilizing all of the data. Artificial Intelligence (AI) as well as machine learning and decision support tools on the market are huge right now. Employers expect benefit providers to use all of them, but they can't if their data isn't consolidated in one place. We're excited to help that digital transformation occur, consolidating data from all of these separate systems in the employee benefit space to ultimately provide more of a cohesive, single platform that can leverage strong point solutions, but also bring some capabilities in-house that you don't necessarily have to have outside of a core processing system.”