Liazon Corp., the Buffalo-based operator of private health insurance exchanges, is taking steps to double its workforce here, just two months after moving into new offices in downtown Buffalo.
The company has 128 workers who fill the eighth floor of the former Fairmont Creamery building on Scott Street, and Liazon already is working with its landlord to take up the entire seventh floor for as many as 135 additional workers, company officials said Thursday.
Liazon was sold in November for $215 million to the global consulting company Towers Watson, but company executives say the investment in the new office space shows that Buffalo and the loyal, local workforce remain an important part of Liazon’s future.
“It’s the most physical sign of our growth and success,” Ashok Subramanian, Liazon’s CEO and co-founder, said in the company’s bright, airy boardroom.
Liazon on Thursday opened its offices in the Fairmont building to invited guests, elected officials and visitors from Towers Watson as part of an official Buffalo “Liazon Day” meant to highlight the company’s rapid growth in its hometown.
Liazon was founded in 2007 by three Buffalo-area natives – Subramanian, Tim Godzich and Alan Cohen – with health insurance industry experience. The founders came up with an innovative model for an online benefits marketplace, targeted to employers, that foreshadowed the public benefits exchanges established under the Affordable Care Act.
The company started out with a focus on serving small clients and now primarily operates exchanges for mid-sized and larger companies, providing benefits to more than 50,000 workers at 800 companies.
The sale to Towers Watson came together quickly for both companies last fall. Under the sale terms, Liazon retained its brand as it became part of Towers Watson’s Exchange Solutions division, while Subramanian joined the Exchange Solutions executive team as Liazon managing director.
“Liazon had very quickly built a terrific reputation in what we call the private exchange environment, and that was something that our firm felt we really wanted to make a play in,” said James K. Foreman, managing director of Exchange Solutions for Towers Watson.
Bryce Williams was CEO of Extend Health, a leader in private exchanges for retirees, when Towers Watson purchased it in 2012. He now oversees its operations within Towers Watson.
During his Thursday visit to Buffalo, Williams said Towers Watson has continued to invest in the greater Salt Lake City area, an Extend Health hub, two years after the sale because it “really likes the cost and value and efficiency that we have in some of these mid- to smaller cities of America.”
Subramanian said he understands that Buffalonians get nervous when large, out-of-town companies buy up a smaller, homegrown outfit, but he said geography won’t matter as long as Liazon is meeting its goals and contributing to Towers Watson’s success.
“The Buffalo issue, if you will, is just not that relevant,” said Subramanian, who added that the Towers Watson purchase has accelerated Liazon’s planned growth track.
Liazon’s Buffalo location allows executives to draw from a talented pool of prospective workers, with little worry of turnover because those workers remain loyal to the company, said David Finkel, Liazon’s chief operating officer.
Liazon last year announced its intention to move from its longtime home in leased space at 737 Main St. into the Fairmont building at 199 Scott St., which is being renovated by Ellicott Development Co.
Liazon’s offices on the top floor of the eight-floor building cover 15,000 square feet and feature an open floor plan, exposed brick and diffused lighting. Executives wanted the look of the space to reflect “the personality of Liazon,” Finkel said.
As part of its expansion into the seventh floor of the building, the company by next month hopes to bring a first batch of 20 or 30 new workers into space that can be used as renovations are completed.
Liazon officials hope that construction work on the seventh floor, which has another 15,000 square feet of space, will be finished by October and hiring of the additional workers can continue through the end of the year and into 2015. Liazon also has 20 or 25 employees based in New York City.