In this week’s episode of Founder’s Journey, Ross talks to Lauren Dai, COO & co-founder of Cocoon!
After spending 4+ years building the growth organization at Stripe, Lauren started Cocoon to help simplify the complicated financial problem of managing employee leave: from compliance & guidance to claims & payroll.
Listen to the full episode to hear about Lauren’s journey building Cocoon, including:
- Discovering & defining Cocoon’s problem to solve
- Finding & winning their first 10 customers
- Building strong relationships with co-founders Amber Feng & Mahima Chawla
3 Insights from Lauren’s Journey Building Cocoon
1. Discovering & defining Cocoon’s problem to solve
When Lauren and her co-founders Amber and Mahima were exploring ideas for a startup, they started broad and narrowed it down throughout the discovery process. They began with two things that they had a mutual interest in: fintech and families.
“We asked, how can we help businesses with their finances, and also bring that to another community we care about?” Lauren said.
So they started talking to families about financial concerns they were having, and heard all the usual things – life insurance, saving for college – but what surprised Lauren was hearing about a more immediate worry from parents: “I haven’t been paid my parental leave yet.”
Lauren and her team did some digging and discovered that employee leave was actually a massive, complicated financial problem, tangled up in the worlds of government, insurance, and company policy. She talked to more people about this problem from the employee side (recruiting user interviews on Craigslist for $30) and then talked to HR teams to hear their side.
“The HR teams and people leaders said that they don’t want this experience to be difficult for their people, but it’s really, really difficult to figure out,” said Lauren.
By discovering what was on fire for the people they talked to – the problem of employee leave – Lauren and her co-founders were able to narrow down their broad vision of helping families’ and companies’ finances, and focus on solving a specific problem.
2. Finding & winning their first 10 customers
Employee leave is a problem that impacts everyone who works – but the Cocoon team needed to be more targeted about going after their first customers.
“We had a hypothesis that our early adopters would be high-growth tech companies,” Lauren said. “Because people are their most valuable asset, and leave is a hyper-sensitive moment in someone’s life.”
How a company handles leave can affect the employee’s relationship with the company, either causing them to fall more in love with where they work because they feel supported, or to fall out of love and leave the company entirely.
Another reason for the hypothesis was that tech companies have become more distributed, especially since the pandemic, so there’s a big regulatory challenge involved with managing employee leave across different states.
To find these early adopters, Lauren and her team tapped a LinkedIn community called PeopleTech Partners, who were known to try new HR tech. She created a targeted outbound list, and started reaching out to people she knew at each company. Soon, Cocoon had its first customers (including companies like Carta and Notion) and began getting more traction from word of mouth referrals.
3. Building strong relationships with co-founders
One piece of advice Lauren would give to other founders?
“Find amazing co-founders,” she said. “I could not be on this journey without Amber and Mahima.”
Lauren first met Mahima at an internship during college, where they won a business pitch competition together. They both eventually moved to the Bay Area to work at Stripe and Square. Lauren met Amber at Stripe, and the rest is history.
“There’s no reason to do this alone,” said Lauren. “For founders thinking about going on this journey, you’re going to love it when you have the right people there to support you.”
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Lauren is the COO & co-founder of Cocoon, the platform that makes managing employee leave instant, simple, and big-hearted for HR teams and employees alike. With Cocoon, employees can design their leave plan in private, notify HR when they’re ready, and rest easy knowing that all their paperwork will be submitted for them. Employers don’t have to lift a finger when it comes to compliance, claims, or payroll calculations. Prior to starting Cocoon, Lauren was integral to building the growth organization at Stripe.