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Once Sorbet offers to buy out the unusable portion of the employee's PTO, it is able to refinance liabilities for employers so they can better manage their cash flows, save on financing costs, and increase tax deductions.
FREMONT, CA: Employees should be rewarded for their paid time off (PTO) days when they haven't been able to use them, contends Veetahl Eilat-Raichel, the founder & CEO of Sorbet. That was Eilat-Raichel's incentive for starting Sorbet, a platform that allows employees to convert unused PTO into cash. This corporate objective resonates deeply with investors as well, and Sorbet announced that it has closed $21M in financing. This development signifies the largest seed round for a Fintech startup in Israel to date. Back in April, the company announced that it had closed a $6M round, which has now been extended by another $15M led by Dovi Frances' Group 11, along with current investors including Viola Ventures, Meron Capital, and Global Founders Capital.
Regarding the Sorbet platform, Eilat-Raichel explains that in the US alone, the value of unused PTO equates to $270B. Often, employees cannot cash out their PTO until they resign or are fired from their jobs. Thus, the unused PTO value creates a cash flow liability on companies' balance sheets from employers' perspectives.
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Sorbet integrates into and syncs with existing calendars of employers, as well as HR and payroll systems. Through this method, the platform identifies habits and analyzes time-management patterns. Sorbet then proactively suggests personalized, pre-approved 3-6 hour "Micro Breaks," 1-4 day "Micro Vacations," as well as +1 week vacations fitting employees' personal preferences without disrupting their work.
Through this unique model, Sorbet increases time off usage by an average of +15 percent and can predict the portion of time-off that the employee won't use (and will end up accruing). Furthermore, once Sorbet offers to buy out the unusable portion of the employee's PTO, it is able to refinance liabilities for employers so they can better manage their cash flows, save on financing costs, and increase tax deductions. This results in a logical and quantifiable win for all. Most importantly, at a time when everyone can benefit from extra cash, employers can offer their employees an enticing financial reward without having to bear the burden of a significant cash expense.
Along with its new finance developments, Sorbet is announcing its expansion of operations from the US to Australia, where labor laws allow employees to accrue PTO indefinitely. That is a significant challenge for any Australian employer, but something that Sorbet can assist with and bring immense value to.
Eilat-Raichel elaborated: "It is apparent that we're in the midst of a tectonic shift in employer-employee dynamics. With inbound global interest exceeding our wildest expectations, I had the incredible privilege of selecting the best investors to help us expand and accelerate. I can think of no better partner than Dovi and the entire Group 11 team to join us, and I'm thrilled and humbled to have them alongside our already stellar group of investors."
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