Fresh off announcing an eye-popping $27.5 million Series B investment round, home care startup Hometeam says it is looking to expand the number of senior living providers it is working with.
Hometeam—similar to startups Honor and HomeHero—utilizes technology to match up seniors and in-home caregivers, provide more visibility into what occurs in clients’ homes, enable more on-demand scheduling and streamline payment processes. It secured $11 million from investors in 2013, and on Monday announced its Series B. Venture-growth equity fund Oak HC/FT joined existing investors Lux Capital, IA Ventures and Recruit Strategic Partners in this round.
Hometeam has built its reputation in large part on its Beautiful Days program, with a goal of creating more personalized care plans that increase a client’s happiness.
Some Hometeam clients reside in assisted living facilities, and the company has created a version of its Beautiful Days program specifically for these settings, founder and CEO Josh Bruno tells Senior Housing News.
“In some cases, we work not only one-on-one with clients, but on programs for older adults inside assisted living,” he says. “For each of our clients in their own home, we create a program that creates beautiful days. We ask, what creates happiness? We’ll take that and generalize it a little more [for facilities].”
Hometeam also has created programs to manage care transitions from assisted living to the home and vice-versa, as well as transitions from assisted living into other levels of care, Bruno says. The work with senior living providers is in keeping with Hometeam’s increasing focus on being not just a private duty home care provider, but a key player in the overall health system.
To that end, Hometeam will be using some of the capital it has raised to develop and implement tools to integrate its caregivers more with other providers.
Specifically, Hometeam workers track health indicators such as weight and blood pressure, and the company is seeking new ways to share these stats with other providers serving Hometeam clients—including rehab centers, physicians, hospitals, home health and hospice agencies. That would allow care plans to be changed more dynamically. Bruno also talks about bringing doctors and other professionals into the home through video, via the Hometeam iPad app.
More robust data collection and sharing also benefits providers from a referral standpoint, as health systems increasingly are looking to work only with organizations that have the best metrics.
No Quick Exit
Given that Hometeam is actively seeking to become an increasingly vital player with the overall health care system, it may raise a question about the future of the company—namely, might it be sold to one of these larger organizations?
This is not the play that Hometeam is preparing for, according to Bruno, although he does not dismiss the idea altogether. Still, when investors ask this question, he says he gives them all the same answer: “We will be the premier provider of in-home private duty health care 50 years from now.”
It comes down Hometeam’s “promises,” which are to be a long-term solution for seniors who need care and a long-term career for top quality caregivers, Bruno says.
“It’s unlikely we end upselling the business to anyone, really, and more likely we remain a standalone entity so we can fulfill those promises,” he says. “If someone eventually came along that offered to acquire us but keep us independent, that could be interesting, but it’s too early to know. Too often in startups, it’s all about the quick buck, and that just doesn’t work in senior care.”
So what is motivating investors to put up such large sums? There are few aspects of the company that Oak and the other investors focused on, Bruno says.
One is growth: the Hometeam business model is repeatable, so that the company can rapidly expand into new cities without compromising quality of care, Bruno says. Although it’s only been in business for about 20 months, the company already is the largest home care provider in northern New Jersey and the second- or third-largest in Manhattan, according to Bruno. While he declines to name specific cities Hometeam might enter next, Bruno says the goal is 8 to 10 new metros this year. The focus will be on areas where the company can make the most significant impact, looking at consumer needs and the existing health system. This might mean cities on the West or East Coast, he says; previously, the company identified Los Angeles and the Bay Area as locations of interest.
Hometeam also is putting up impressive numbers in terms of client retention. Bruno says that by total number of hours per client, Hometeam is well above the industry average: Its clients stay with the company seven times longer than clients remain with the average home care company, he says.
In an industry facing major labor challenges, Hometeam also is performing well on staff recruitment and retention, Bruno says. Hometeam directly employs its caregivers, offering them above-average wages, paid time off and sick days, and other benefits. Hometeam can spend more on labor than many competitors because it achieves efficiencies through its use of technology, Bruno says. He says the company currently employs hundreds of caregivers and this will increase to the thousands early in 2016, with recruitment driven mainly by referrals from current workers.
But it also helps that Hometeam has found investors who are connected to the startup’s mission, Bruno notes. He explains that Oak and other investors are worried less about top-line revenue growth and more about the overall value the company is providing to the end-user—in this case, seniors who need home care.
“The team at Oak looked at what we’re doing each and every day, the impact we have,” Bruno says. “They know we’re doing something right.”
Written by Tim Mullaney