Whether it’s the barista who always gets your morning coffee just right or the cosmetics sales associate who helped you build a personalized beauty ritual, hourly employees are the face of the businesses they represent, and they’re vital to ensuring those businesses succeed. SparkPlug is helping take this view beyond the tip jar when it comes to compensating hourly employees for their proficiency.
The San Francisco-based company developed an incentive management and wage supplementation solution. With its product-led business-to-business tool, SparkPlug partners with brands, restaurants and other businesses to help them offer employee incentives based on how much product employees sell. SparkPlug announced Thursday an $8 million Series A round led by Lightbank to allow hourly employees to earn what their expertise says they’re due.
“I’m so excited to really change the paradigm of the hourly employee, particularly in these retail and restaurant environments,” Andrew Duffy, SparkPlug’s CEO and co-founder, told Built In. “I want society in five years to see these roles — and the people in these roles — as valuable, as knowledgeable, as skilled and as well-compensated members of the economy who are contributing so much because they’re already doing that, we just don’t think of them that way.”
SparkPlug’s software gathers data from retailers’ point-of-sale systems on what products are sold and which employees sold them. This intel lets SparkPlug offer brands and retailers the ability to incentivize their employees with campaigns, sales goals or contests. Ultimately, SparkPlug helps businesses increase product sales while simultaneously rewarding the people doing the legwork.
During the pandemic, businesses powered by frontline employees faced challenges when providing the service and satisfaction customers expected. Now that more people are reentering physical spaces, businesses are searching for ways to differentiate themselves from digital experiences. The main advantage they offer is the point-of-sale employees who can potentially have influential experiences with customers, Duffy said.
“The vision behind SparkPlug in so many ways is to professionalize that role of frontline workers that is so commonly … seen as the bottom rung of the workforce,” Jake Levin, SparkPlug’s COO and co-founder, told Built In. “We really feel so strongly that these people are experts who so often make careers out of working on the frontlines and serving customers and are passionate about the products in the industry. … SparkPlug allows those employees to focus on those skills and get compensated for working to improve them over time.”
SparkPlug has come a long way since its founding in 2020 when it began as a way to grow Levin and Duffy’s herbal tea shop. In 2021, SparkPlug pulled in a round of seed funding. Since then, the company has recorded 2,310 percent revenue growth.
SparkPlug works with over 1,000 retailers across the U.S. and more than 200 brand partners. Some of its restaurant partners include Wise Sons and Nick the Greek.
Looking to continue its recent growth, SparkPlug will expand into new verticals with the Series A funding, including cosmetics, outdoor gear and dietary supplements. It also plans to expand upwards from small and mid-market operators to larger business partners.
The software solution plans to grow into new locations, such as Canada, the U.K., Australia and Latin America. SparkPlug will also put some of its new capital toward hiring product and engineering talent.
