The Business of Aging

Caring.com Raises $10 million In 2nd Round. Total $16 million Raised Since 07.

In September 2007, Caring.com raised $6 million led by DCM and Split Rock Partners.

This week Caring.com announced a 2nd round funding of $10 million led by a new investor, Shasta Ventures, with participation from previous backers DCM and Split Rock Partners.

The company has raised $16 million in total.

Caring.com says it will use the money for new hires, as well as an expansion of the core Caring.com site, and Gilbert Guide, the eldercare services directory it acquired in October.

Caring.com runs display ads and sponsorships; co-founder and CEO Andy Cohen said about half of the site’s advertisers are pharmaceutical brands. As for the recent scrutiny by the FDA around pharma ads, Cohen said Caring.com was insulated because the Agency was focused on search ads and user-generated content—not display ads or curated editorial.

I know Andy Cohen and respect the work he is doing at Caring.com. Raising $16 million in three years is a LOT of money in any economy. But to raise $16 million in this economy is quite an accomplishment - almost unheard of. What this tells me is the investors -- who have had access to all the financials and web analytic data of Caring.com -- like what they see. Tod Francis, managing partner at Shasta Ventures, said the company’s traffic growth and ad performance were what attracted the investment (Caring.com says web site traffic has grown to over a million monthly uniques).

Laurie Orlov, a former Forrester analyst, wrote a post on her Aging In Place Technology Watch blog about Caring.com and their business model. It's quite good.   

She says……(I paraphrase - read the whole post here):

"
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Like WebMD, Caring.com faces a lot of competition. Time will tell if they achieve the same level of success. 

Caring.com Buys Gilbert Guide. Smart Move (by both parties).

Caring.com announced today it has acquired Gilbert Guide, an online senior housing directory where caregivers can search for local providers. According to Venture beat, Caring.com currently has 700,000 monthly unique visitors. Now Caring.com will give its members access to Gilbert Guide’s housing guide.

Read the details here.

According to the news story, "the consolidation helps Caring.com compete against other elder care sites and companies such as A Place for Mom… and other ['searchable' senior care directories]….." 

The deal value wasn’t disclosed, but Caring.com exchanged equity to acquire Gilbert Guide -  an unbelievably  fabulous deal for Caring.com which has raised $6 million of VC money the last few years from DCM and Split Rock Partners. And the fact that the Gilbert Guide founders took equity for the sale of their business (if true) would indicate the desire for a liquidity event by Caring.com within the next 3-5 years (assuming this economy improves).

Andy Cohen, CEO of Caring.com is a very likable individual who seems to be in this business for all the right reasons. And based on my several meetings with him, I find Andy to be a very capable CEO. Reading about this acquisition reaffirms this belief.

This was a very, very good acquisition. Really.  

In June I wrote a blog titled "Searchable" Senior Care Directories. A Rapidly Growing Product Category       that discussed this growing space of Internet sites that allow caregivers to search for senior care services - from in-home care to assisted living/nursing homes to handyman services.

Quite a few of these companies have recently signed up for our SeniorCareMarketer.com service so we're getting to know the space quite well. And each week I think I'm introduced to a new one.  Many of them are listed in the SeniorCare Directory.

This space is HOT at the moment although many will not be around in a few years unless they can figure out how to make money with something other than "paid listings".

And this is why I believe Caring.com's acquisition of Gilbert Guide is so strategic.

Aside from (gosh I hate to use this phrase) the obvious synergies, this deal gives Caring.com a new revenue source (Gilbert Guide made money from paid listings, advertising, and licensing their database to a number of other directory sites - although a few deals could possibly be in jeopardy now that Caring.com is involved), additional advertising opportunities, greater access to the caregiving community (consumers and providers/vendors), the ability to better target ads (which command higher premiums), and the ability to deliver an overall better user experience. This deal also brings a whole host of growth and new product opportunities to Caring.com that they would otherwise not have had.

Kudos to Andy Cohen and Caring.com for a super buy. I wish them success.