Brisbane-based aged care startup Five Good Friends has raised $5 million in funding, to expand its platform designed to keep people living comfortably in their homes for longer.
The startup was founded by Nathan Betteridge and Simon Lockyer, the entrepreneurs behind charity fundraising startup Everyday Hero, which was acquired by US company Blackbaud back in 2011.
Five Good Friends applies technology to the aged care sector, providing a platform to connect people requiring home care services with one or two regular helpers, while allowing the other family members to monitor care hours and services.
“The number one topic at dinner tables when we get together with our friends is concern about how loved ones are going to grow older,” Lockyer tells StartupSmart.
Having exited their first startup, he and Betteridge were looking for a new project, and as they looked into it, found “where there was a great need for disruption was in the homecare area”.
Care in the home is “a family challenge, not an individual challenge,” Lockyer says.
“It’s about understanding there’s a whole network of people around who are intimately and lovingly involved,” he adds.
The startup bears an unusual name, but Lockyer says it was partly chosen to avoid any negative connotations of home care or aged services, and also to focus on the community benefits and promotion of friendship through the platform.
The founders researched several studies on longevity, including a Harvard University study that tracked the health of 268 people over 80 years.
All the studies concluded the people who live longest tend to have “between five and six really, really good, close friends”, Lockyer says.
“Our purpose is about keeping people connected to their communities that they know and they love,” he adds.
A global challenge
This latest $5 million raise follows an initial $4 million raised in 2016, and according to Lockyer, more than 80% of participants in the first-round have invested again.
In the second round, however, the startup has attracted investment from Singapore and Hong Kong.
“We’re on the verge of having a truly internationalised offer that we will be able to replicate into markets,” he says.
Although there will be cultural differences to the offerings, the startup is addressing “a challenge that’s facing us all over the world,” he adds.
However, Lockyer stresses the startup is focused entirely on the Australian market, for now.
“[We’re] very focused on the Australian market and creating the best product and service there. Once we achieve that we will consider other things,” he says.
Since the first raise the business has grown, with the number of visits increasing by 178% over the past 12 months, and the average length of visits increasing from two hours to 2.4 hours.
That’s important, Lockyer says, because a key part of the service is matching people with the right helpers.
“Having the same people who get to know you and understand you … is one of the key things people want,” he says.
“[Members want] people they know and like, and who have the right skills.”
Currently, there are about 300 vetted and verified helpers on the platform across more than 350 active memberships, across seven Australian locations.
The $5 million will be directed towards marketing efforts, to “drive the business through to its profitable state”, Lockyer says, but it will also go towards working on the technology and the platform.
The startup has two-and-a-half years’ worth of data, drawn from reviews of visits and helper notes.
“Our context is so tight, we can actually get a much better sense of risk and what’s happening and whether, after a visit more investigation is required.”
Making better use of the data could help Five Good Friends to “leverage our eyes and ears in the home” to tailor care plans and provide a higher quality of care.
“We’re moving from the idea of home care to caring homes,” Lockyer says.
“Let bad ideas go”
Lockyer’s advice to other startup founders is to “keep a really keen ear to your users and the market … and let bad ideas go quickly”, he says.
The business should be shaped to market demand and feedback, and founders shouldn’t be afraid to admit something didn’t work, he adds.
That said, especially when raising capital, they should also strive to maintain the passion for their idea, and the category they’re working in.
“In my experience, investors will look for a good idea, but also founders that believe in it and have the enthusiasm,” Lockyer says.
“You really have to have a connection to the product and the market you’re servicing,” he adds.