Blog 30: Mirza
Lightening the burden of childcare costs for hourly employees
Company: Mirza operates a fintech platform designed to support working parents and employers in providing family and financial planning. The company's tools integrate family financial planning and childcare funding, and provide assistance in corporate policies for parental leave, fertility options, and modern parenting advice for employees, thereby helping working professionals to achieve their financial goals.
HQ Location & Year Founded: London, 2020
Founders: Siran Cao (interviewed, pictured left) and Mel Faxon are mission-driven entrepreneurs. Armed with a bachelor’s in Gender Studies from Harvard and a master’s in Social Business and Entrepreneurship from the London School of Economics, Siran has been an operations leader at Uber before becoming a founder. Mel is a second time founder, a UVA grad who cut her chops in the startup world, driving revenue and growth across portfolio management, sales, and marketing roles before getting her MBA from London Business School. The duo are now focused on solving the massive challenge of childcare affordability.
Funds Raised and VC Investors: $1.7 million from 500 Startups, Chaos Ventures, Pink Salt Ventures, Portage Ventures
Where did the idea for Mirza originate?
I’m a first-generation immigrant from China. My mother was forced to give up her career once we moved to the US. After my father left, I saw first-hand both the long-term financial impact on the family of trying to get by on limited income, and the toll the trade-offs my mother made on her identity. I now see this issue as a caregiver myself, and how common this experience is, Mel and I set out to eliminate that trade-off between paid work and caregiving.
What is the key problem that Mirza intends to solve?
We are working to solve the link between affordable childcare and employee retention. We provide both financial education and a platform for no-interest, forgivable childcare loans that employers can offer to their employees. We design childcare subsidies that any employer can get behind, effectively, by aligning the forgiveness with key goals for driving revenue. We focus on front-line employees, which include many single moms like mine, who must schedule their workday around daycare and school pickups. For these employees and their employers, childcare is still a day-to-day disruption. I saw this at Uber. I wanted to promote some talented hourly employees to roles with greater responsibility, but we often ran into challenges with managing around family needs. At the same time, I saw how people took out loans to get better quality childcare and the deep sacrifices that working parents had to make for the kids.
How are you most differentiated as a service?
We work with employers to finance childcare for their employees at no interest and build terms and forgiveness around the employer’s key goals. Not only do we provide financial wellness education with our platform, but we also change the underlying economics for the employee. We charge a small SaaS fee to the employer. It is the employer that does the lending, and we provide the platform and a complementary set of tools for the employer and employee to use. It is a turnkey program that allows the company to operate this benefit at scale. We give each individual employee a plan for how to utilize funds that employers are willing to provide, with guidance on how to use this with tax-advantaged accounts. It is a single place to understand overall family finances, including how payment and vesting schedules work and other practical information.
What are the company’s key accomplishments to date?
We have been testing with about 100 folks this year. Our “Version 1” will be getting implemented with a major retailer client starting next year. We are also piloting and in advanced discussions with organizations that range from a solar company to manufacturers to school systems.
What lies ahead in the plans for Mirza?
We will keep building a financial platform and informational resource. Our roadmap includes adding helpful government support. In the longer run, we will be able to start to move from just early year childcare to also helping people with costs for after school care, camps, elder care and more. From a customer standpoint, we are talking to major manufacturers and many SMEs with operational, front-lines employees.
Ron’s Take
The cost of childcare, particularly full-day care, confounds parents across the socioeconomic spectrum. The first question is how our country got itself into this position in the first place, where kids can go to school during the day beginning at age 5+, however for the first five years of life, parents are left to their own devices to figure everything out. The US stands out among developed countries in this regard. Early-stage companies like Mirza and Kinside (as featured in a previous blog post) are working hard to disrupt this vexing issue and we will need more groundbreaking innovation in the space so long as the government, with its inaction, continues to fail working families in this regard.