Categorized | Social Entrepreneur

Employee-Funded Wellness Program Tackles Obesity in the Workplace

Employee-Funded Wellness Program Tackles Obesity in the Workplace

When Ryan Beckland and Drew Schiller met as undergraduates at the University of Iowa, they spent long hours discussing societal woes and debating ways to fix those problems and make the world a better place. Now, ten years later, the two have formed a company called Scale Down Challenge to take one social issue—our country’s obesity epidemic—head on.

The idea for Scale Down Challenge first came when Beckland read about a study by behavioral economists that showed financial incentives to be highly effective for motivating health behaviors, including weight loss. Beckland and Schiller recognized that by systematically providing the right financial incentives in an online format, they could effect positive change for a lot of people.

About 75% of U.S. adults are obese or overweight, including many of the co-founders’ family members. “Having seen friends and family struggle with obesity and obesity-related health complications throughout our lives, we knew that we could do something big to help turn the tide,” says Schiller. They brainstormed and came up with a tournament structure to reward weight loss.

Scale Down Challenge first launched in June 2010 as a community weight loss tournament in Lawrence, Kan. Tournament entry fees funded the prize pool, and winners were determined based on the percent of body weight lost. “After a few iterations of the concept we realized that weight loss tournaments are very logistically difficult to administer, so we built software to help us conduct our tournaments. We started getting a lot of requests from companies to organize tournaments on-site, so in January 2011 we pivoted into a software company,” says Beckland.

Now, Scale Down Challenge is an online SaaS model that makes it easy for companies to administer fun, competitive weight loss tournaments for their employees. As with the original tournament concept, participant entry fees fund the prize pool.

This “participant-funded” model keeps costs down for the employer, because companies don’t have to shoulder the entire cost of the program. The program also sees a high level of engagement, which Beckland and Schiller believe is due in large part to the fact that tournament participants actually “buy-in” with their own dollars.

To set up a tournament, companies pay between $300 and $1500, depending on the software features selected, and participants each pay a $25 entry fee. Scale Down Challenge takes $10 per participant entry, and the remaining $15 funds the tournament prize pool.

Most importantly, Scale Down Challenge tournaments are effective. Competitors in the 10-week challenges have lost an average of 19 pounds, a statistic that is very encouraging, says Schiller. “We’re finding that tournament participants lose weight by eating healthier and getting more exercise. It’s exciting to know that Scale Down Challenge is leading people to meaningful lifestyle changes.” And even small changes can make a difference, Schiller points out. “According to research, obese individuals significantly reduce their risk for heart disease and type 2 diabetes—two of the most costly preventable diseases—by losing just 5-10 percent of their body weight,” he says.

In some cases, though, tournament participants have results that are anything but small. “One competitor lost over 30 pounds during the tournament,” Schiller says, “and continued losing weight after that. A year later he had lost a total of 70 pounds and had completely changed his lifestyle. This happened because his workplace held a weight loss tournament…and the lure of winning some cash gave him the motivation to sign up and lose weight.”

Employers, of course, know that healthier workers miss fewer days of work and visit the doctor less often, leading to cost savings that can be passed along to employees in the form of lower insurance premiums. Schiller cites research that found an obese person who exercises at least once or twice a week will have health care costs $450.00 lower, on average, than an obese person who leads a sedentary lifestyle. “The tournament participants who don’t win money are still winners, because they’re losing weight, eating better, and thinking more about getting exercise,” Schiller adds with a smile.

In launching Scale Down Challenge, Beckland and Schiller received help from several business incubators and business training programs. In particular, they worked closely with the Lawrence Regional Technology Center (LRTC), a University of Kansas early-stage business incubator. “LRTC has been instrumental to our success so far, including helping us close our angel round in August,” says Beckland.

Employee-Funded Wellness Program Tackles Obesity in the WorkplaceSo far, nearly 500 people have lost weight by taking part in Scale Down Challenge tournaments—and the software product has only been on the market for about a month. The company intends to expand aggressively over the next year, with the goal of reaching 30,000 participants by January 2013.

Schiller believes that social entrepreneurs must provide the best possible user experience. “Start ups have to make it a priority to delight their users. That’s the only thing that will keep them coming back. For us, that means providing a strong health ROI. But it also means that the user interface and design experiences have to be impeccable.”

Beckland suggests that social entrepreneurs focus relentlessly on just one significant problem. “We’ve been asked several times if we are developing other wellness products such as a health activity tracker, or a product that addresses smoking cessation—but doing that at this early stage would make it difficult to thoroughly cover any one problem really well. So we’re focusing exclusively on just one issue: obesity.”


To learn more about Scale Down Challenge, visit their website, or call them directly at 1-800-495-7934 to setup a weight loss tournament at your company. Follow them on Facebook (scaledownchallenge) and Twitter (@GoScaleDown).

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