Sharebite founder Dilip Rao shares how surviving a serious car accident prompted him to found a mission-driven meal benefits company.
BY ANNABEL BURBA, EDITORIAL FELLOW @ANNIEBURBA
Dilip Rao. Photo: Courtesy Subject
Dilip Rao‘s mission to alleviate American food insecurity centers on two words: free lunch.
His company, Sharebite, allows companies to provide free lunch as a workplace benefit, whether employees are in-person, hybrid, or remote. And business is booming: Sharebite, founded in 2016, has grown by 4,914 percent over the past three years and ranked number 56 on this year’s Inc. 5000 list of the fastest-growing private companies in the country.
On the latest episode of Inc.’s From the Ground Up podcast, Rao explains why “the mission is what dictated the business” at Sharebite, and not the other way around.
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In 2014, Rao–who was working as an investment banker at Credit Suisse–was hit by a car. He woke up in the hospital, unable to move from the neck-down.
Rao says this forced him to take a long, hard look at what he’d accomplished in life. And while he hadn’t yet conceived of the exact business that would become Sharebite, he felt motivated to become a force for good in the world. “I certainly thought about the mission … of helping align the incentives for the private sector to undertake the burden of public good,” he says.
Rao founded Sharebite two years later with that mission in mind, and things went well until the Covid pandemic hit. Sharebite had no paying customers at the time, so Rao nixed his salary, moved to his in-laws’ basement, and focused his team on rebuilding.
When companies began trying to entice employees to work in-person again, he says, business boomed: “WeWork was one example where they were like, ‘Whatever we’ve got to do to bring employees back. Hey, is food going to do it? Okay, we’ll try anything.’”
For some companies, offering free lunch as an employee benefit is a new concept. But Rao says Sharebite’s utilization rates—often 95 percent or higher—put other benefits to shame, which helps convince even the most skeptical HR leaders.
“Everybody eats,” Rao says. “From the lens of maximizing not only return on invested capital, but utilization rates, you’re offering a meal stipend, people are going to use it.”
To hear the full episode, click here or listen using the player above. From the Ground Up is also available on Apple Podcasts, Spotify, or anywhere else you listen to podcasts.
What follows is a full raw transcript of the episode.
Lagorio-Chafkin: Diana. Christine. So tell me, what’s your go-to office lunch
Ransom: If I’m buying?
Lagorio-Chafkin: Yeah, just whatever.
Ransom: I will take something from home, and sadly put it in a plate, and try to eat it at my lunch while I’m typing away.
Lagorio-Chafkin: That’s good. How many days a week do you remember your lunch? Because I feel like I make my lunch and then I just leave it sitting on my counter at home.
Ransom: That’s exactly what I did today.
Lagorio-Chafkin: Oh!
Ransom: I forgot my lunch, so I didn’t eat lunch. And then you reminded me to eat lunch.
Lagorio-Chafkin: I’m hangry.
Ransom: Let’s have steak and lobster. This is From the Ground Up. I’m Inc. executive editor, Diana Ransom.
Lagorio-Chafkin: And I’m editor at large, Christine Ligorio-Chafkin. Today’s episode, Scaling the Office Lunch.
Ransom: So Christine, for today’s episode, I spoke with Dilip Rao, who’s the founder and CEO of a company called Sharebite. Have you heard of Sharebite?
Lagorio-Chafkin: I have heard of Sharebite, mostly because you wrote about Sharebite for our Inc 5,000 issue.
Ransom: That’s right. They were number 56 on this year’s list, and they grew their three-year revenue by some gargantuan amount of money. Their revenue growth was over 4000% over three years, so doing gangbusters. But yeah, so Sharebite, what they do is they do basically your standard corporate food ordering platform, but also they’ve mixed in an HR element so that it’s basically if you could think of your lunch every day as a benefit, like healthcare.
Lagorio-Chafkin: Oh, interesting, yeah.
Ransom: Or the gym membership.
Lagorio-Chafkin: So how does that work if you’re an employee of a company that uses Sharebite?
Ransom: Well, they have different strategies. So one is you would just tell the office manager… She sends out a link, and then you say, “Okay, we’re ordering from Sweetgreen today.” So they work with a number of different vendors, especially they work with local vendors depending on where you are. So a couple of Nashville vendors in Nashville, local places in New York City too. So you would just order, do a group ordering if you want, and then your company would subsidize a portion of that meal. So therein lies the benefit.
Lagorio-Chafkin: Okay. But a remote worker could take advantage as well, perhaps.
Ransom: Yeah. We’re going to get into that during the interview.
Lagorio-Chafkin: Okay.
Ransom: But definitely they’ve grown a lot in new ways, and that’s one element that they’ve grown.
Lagorio-Chafkin: That’s amazing. So this company sort of took off out of the pandemic. Why are we speaking to them now?
Ransom: Yeah, so I’ve actually spoken with Dilip a couple of times. The first time I talked to him, I wasn’t actually able to utilize one part of his story in the piece that I wrote, and it just stuck with me. It’s like the kind of thing that just sticks with you, and you’re like, “This guy’s story is so incredible.” And then the fact that they were on the Inc. 5,000 this year was like, now here’s my opportunity to tell this guy’s real story.
Lagorio-Chafkin: Okay. You have to tell us the story now.
Ransom: Let’s let Dilip tell his story. But first I started the conversation with him by asking how he talks to clients about food as a benefit.
Dilip Rao: It depends on the customer. We segment the customers, the clients, so to speak, across really two different buckets. And then there’s other separate buckets thereafter, but the primary bucket is, do they already have an employee meal program? If they do, the decision’s a bit of a no-brainer because they see our technology, they see who else uses us, of course, but they see the technology, and it just kind of blows their mind that we’ve literally thought about everything.
And then they look at our back end, they ask all these odd questions. It’s funny to listen to these calls once in a while. And they say, “Well, this is a bit of a crazy idea, but do you have this?” And then it’s like magic, right? Someone on our account management team says, “Hey, Diana, go ahead and hit refresh on your browser.” And it’s there, because we’ve thought about it. We’ve got thousands of different features all built-out. So it’s really about what you want. And we just turn it on for you. It’s amazing.
Ransom: In the realm of things that you have thought about already, when I was writing the story for the Inc. 5,000 issue about your company, I personally went down the rabbit hole on, “Can you actually… Is this an IRS-sanctioned kind of thing? Can food be a benefit?” Is that one of the things that you have quote, unquote, “thought about”?
Dilip Rao: Again, not allowed to offer tax advice here, so we’ll leave that caveat. The question rarely ever comes up among our customers because they’re sophisticated enough. Most of them are large enterprises with large enough accounting and legal functions that they’ve figured it out already. So the question about taxation rarely ever comes up for us.
It’s more about, “Do you have the feature set?” Much of the conversation nowadays is largely carried out by either HR or what’s called total rewards or benefits, or there’s this other function known as employee experience or workplace experience. Those folks tend to know this space inside out. And so whenever our team ends up meeting people among those groups, we have an honest conversation with them.
And so the thing that’s come up largely over the last few years, we’re in this high interest-rate environment, even though the recent rate cut announcement. In a high rate environment, people are not willing to spend as much money. But what’s been interesting is the best companies and the best CFOs really bifurcate the outlay of cash flow between expenses and investments. They hate expenses, but they love investments.
And so what’s largely been happening, and we’re at this forefront of it, is a conversation around benefit utilization rates. And I’ve learned a lot in this category too, because if you talk to HR leaders and benefits, total rewards leaders, you ask them, “What’s the successful benefit that you’ve implemented with respect to utilization rates?” They’ll tell you, “Hey, if we have a, I don’t know, 7, 8% utilization rate, that’s a successful outcome.” So that’s a bit of a head-scratcher to me, right? Because, “What do you mean?” “Well, we offer the standard benefits, medical, dental, and vision, et cetera. But then we have all these other benefits too. But our struggle is that it’s not utilized. We’re paying for it.”
Some of the best companies, one in particular that over the summer I was at the office of in New York City, company that I personally very much admire, they pride themselves on being a great place to work. Visionary founder, et cetera. And their chief HR officer said, “Hey, we have a very good utilization rate.” “In terms of numbers, what does that translate to?” It’s like, “I’m 20%.”
Ransom: Oh.
Dilip Rao: That’s pretty high in the benefits world. Anybody who’s in the benefits, total rewards space listening to this will concur, they’ll agree. Meal benefits have a 95% utilization rate. It literally puts every other benefit that any company offers to shame, and from different perspectives. Because today every company is looking at maximizing its return on invested capital.
And they’re also looking at bundled benefits programs where they’re offering, I don’t know, pet insurance. Not everybody’s got a pet. And those who have a pet may not necessarily want pet insurance. Adoption benefits. Nothing wrong with it. But I’ve worked at a lot of companies that have offered, and I know a lot of companies that do offer that. Not everybody adopts a child, right? It’s a great offering. We ourselves used to provide our employees, I believe we still do, a gym subscription, like a monthly whatever. There was literally two people on our team using it.
Ransom: Oh no!
Dilip Rao: And so it was really, this stuff that we have observed with our customers, I saw it going down in our own company, because our head of finance and our head of HR on a call being like, “Why are we paying for this thing? There’s only two people using it.” It’s bundled.
Ransom: Right. But food, everybody can get down with food.
Dilip Rao: Correct. Everybody eats. From the lens of maximizing not only return on invested capital, but utilization rates, you’re offering a meal stipend, people are going to use it. And you can offer the meal stipend through our technology........