Nine Entertainment Co’s Domain Group has led the seed investment round for KindiCare, pledging $1.2 million for the leading edtech marketplace startup — making the real estate giant the largest individual investor in the $3.3 million pot.
The hefty stake will see KindiCare’s app and website syndicate Domain’s property listings — Domain has included KindiCare’s listings on their app and website since September 2021, but the partnership has evolved to a paid data licence agreement in addition to the investment.
The startup’s founder and CEO Benjamin Balk retains the majority stake in the business he founded less than a year ago — it has experienced intense growth since, with more than 60,000 sessions on the app in March.
It was personal for Balk — a parent himself, he found the process of searching, comparing and applying for childcare services tedious and stressful, so he created the childcare marketplace to connect families with viable options based on their location, budget and needs.
“I saw an opportunity to create a user experience that offered the same level of sophistication that you find in marketplaces in other sectors such as property, cars, food and hotels,” he said.
“There are more than 1 million families using early education and childcare services in Australia, each of them facing the same level of frustration that we experienced as a family in our own early learning journey.
“It is a market that has lacked innovation in the early learning search experience to the disadvantage of both families and early learning providers.”
It might seem like a curveball from Domain Group, which is home to one of the largest portfolios of property brands in Australia, but Domain’s Chief Product Officer Nathan Brumby says KindiCare’s smart use of data and platform-based solutions to deliver a better customer experience made it a good fit.
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In addition, Brumby says, childcare and schools play a big part for parents when shopping for a home to rent or buy.
“Partnering with KindiCare will allow Domain to provide parents with the most complete and accurate information to better understand the quality and cost of childcare in the local area of their property search, and deliver to our purpose of inspiring confidence for all of life’s property decisions,” he said.
The stake is also a nod to Domain’s own school zones search feature, which allows users to search by school catchment zone for properties based on schools they want to live near.
“The speed at which KindiCare has become dominant in its sector is impressive and we welcome the opportunity to be part of its future expansion,” he said.
So what next for KindiCare? Balk says the team is looking forward to expanding its market share and rolling out innovations, like the soon-to-be-released KindiCare CRM and Portal App for childcare providers and a new early learning service comparison tool for families.
The marketplace portal will provide a B2C channel for the first time, a two-sided platform for more than 7400 childcare providers in Australia.
Balk also hopes it’ll see better transparency for parents overwhelmed with costs in the childcare space — he points out that Australia’s childcare fees are among the highest in the world, and our Childcare Subsidy can penalise two working parents.
“Platform features like the KindiCare Search with Subsidy and KindiCare Rating help parents easily compare the cost, value for money and quality of their early learning options.”
It comes as Labor Leader Anthony Albanese declared childcare wold be his prime ministerial legacy this week at the Australian Chamber of Commerce and Industry.
“One of the most effective ways we can boost participation is by getting rid of the complicated mess of payments that put hurdles in the path of parents wanting to return to work,” Albanese said.
“This has been evident for some time. And it’s why Labor’s plan to move toward universal provision of affordable childcare was the centrepiece of my first budget reply back in 2020.”
Labor would increase the maximum childcare subsidy from 85% to 90%, slow down the rate at which the subsidy tapers off, and remove the annual payment cap — leaving 96% of parents better off as a result.
The Productivity Commission would also be tasked with investigating a move to a universal 90% subsidy — which would fundamentally revolutionise childcare in Australia.