Would a cash bonus convince you to hit the gym? This startup wants to find out

December 11, 2017
person running fall karrot health
Image via shutterstock

In their efforts to promote health and wellness, many companies cover gym memberships for their employees. But what if they just paid them to work out instead?

That’s the premise behind Karrot Health, a new Chicago startup targeting the employee wellness market.

“When I worked for Uber, they gave me $80 a month for a gym membership, which adds up to almost $1,000 per year,” said founder and CEO Kelley Halpin. “All they could tell was that, at some point, I signed up for a gym.”

Karrot lets employers set up a recurring “bonus” for employees that is unlocked by hitting certain fitness milestones — like logging 10,000 calories’ worth of workouts in a single month. Employees track progress using wearable devices or the fitness tracking features built into their smartphones.

To ensure that employees actually take advantage of the program, Karrot’s iOS app pulls data automatically from HealthKit, Apple’s default fitness feature, allowing users to track workouts without having to remember to activate anything.

“That the data was collected passively was important to me,” said Halpin. “Once you set this up, you are good to go. Everything just runs smoothly on its own after that.”

Halpin said Karrot is currently gearing up for beta tests with a handful of early customers. Companies typically offer around $50 per month per employee in incentives, but they’re free to adjust that amount as they see fit.

While Karrot’s beta version is centered primarily around payouts for workouts, Halpin said his long-term plan is to build a full-fledged workout app with personalized challenges and social features. He also wants to dig deep into their data to learn how, when and where users are exercising in order to nudge them into exercising at just the right time.

Although Karrot is initially launching for iOS and Apple Watch, its goal is to support as many devices as possible, including Android devices and popular fitness trackers like Fitbit. To get there, the startup is recruiting for additional technical talent.

“We’re looking for at least two or three developers to start,” said Halpin. “We’ve got a lot of work to do.”

For now, Karrot is primarily working with startups and smaller technology companies, which Halpin said tend to be more open to adopting new technologies — and have employees who use Apple Watches and other wearable devices. But he’s also in dialog with some larger employers.

“When companies reach a certain size, they start to self-insure employees,” he said. “That makes health insurance costs very important for them.”

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