HomeHero Locks Down $23M For Its Home Care Marketplace
(from Tech Crunch)
HomeHero, a Santa Monica-based startup that works to connect home care workers with the families that need them, announced today that it has raised $23 million. The sum includes a $20 million Series A round of capital, in addition to a previously undisclosed $3 million capital event. The funding was led by Graham Holdings.
I met the HomeHero founders, Kyle Hill and Mike Townsend, after their last startup, FlowTab, wound up its operations. Over the course of several interviews with them, I chronicled their progress with FlowTab and ultimate decision to shutter the startup.
Things are going a bit differently this time. The company claims to have helped deliver a million hours of home care since January of 2014, have doubled the number of shifts that it helps facilitate since March of this year, and racked up 25 percent monthly growth so far in 2015. Not bad.
As it turns out, home care is cheaper than I might have expected, averaging around $18 per hour on the HomeHero platform. The company nets around 15 percent of that figure, on average. (The simple math is $18 * 1,000,000 * 0.15, or $2,700,000 in revenue to date for HomeHero, an estimate that could be off by a huge margin in either direction.)
Shifting from a $3 million infusion to a $20 million check demands new scale, and the startup seems ready to meet that requirement, planning expansions to two new California markets, including San Francisco. In an email to TechCrunch, co-founder Townsend indicated that the company intends to expand next to the ‘Sun Belt’ areas.
HomeHero is a product of Science, a Los Angeles-based incubator. For a deeper look into the origins of HomeHero, TechCrunch has you covered.
Marketplaces are hot, as are businesses that help connect two separate parties while taking a cut along the way. Some call this the “Uber for X” model, while others with a touch more historical perspective view the groups as middle people in the most lucrative sense of the world — that joke is predicated on solid unit economics, of course.
HomeHero’s new challenge is to demonstrate that what has worked on its home turf can work elsewhere at similar margins.