MICHAEL TOWNSEND, 27 KYLE HILL, 28

HomeHero Inc., a Santa Monica digital platform for hiring in-home caregivers for seniors

Employees: 15

Financials: Raised $3 million

Michael Townsend and Kyle Hill had big plans to take over the bar scene in 2012. That year, the young duo launched Flowtab, an app that let customers order and pay for drinks from their smartphones.

But as many tech startups do, Flowtab failed quickly, primarily because of a lack of funding and guidance. That’s when the co-founders decided to shift focus and attempt to solve a problem much bigger than the speed of service at local bars.

They turned their attention toward the health care industry and started raising money for HomeHero in May 2013. The platform launched in January 2014.

“We really doubled down and went entirely in a new direction,” Townsend said.

HomeHero is designed to connect elderly patients and their families with qualified caregivers – or “heroes” – based on patients’ needs.

But the health care industry wasn’t quite as natural a fit for the young entrepreneurs as the bar scene. That became especially clear when Townsend and Hill attended a health care conference in 2013 to network with about 400 of their new peers and learn about the complex industry.

“There were maybe 20 guys there,” Townsend said. “Out of those, everyone had a suit on and was at least 50 years old. We were there in our HomeHero T-shirts and flip-flops.”

Indeed, Hill said he still feels like he and his partner are in the extreme minority, but, for him, the stakes are too high to quit.

Hill came up with the idea for HomeHero after his father, who lives in Ohio, had countless bad experiences with the caregivers he had hired to care for his mother in the Seattle area.

“Caregivers were stealing or just not showing up,” Hill said. “It’s one of the biggest problems in America.”

HomeHero is designed to make the process much simpler for out-of-state families, Hill said. After families answer a series of questions, HomeHero matches about a half-dozen prescreened caregivers based on availability, skills and proximity to the patient.

The “heroes” then use the same platform to clock in once they’ve arrived at a patient’s house. At the same time, families are notified within minutes if the caregiver doesn’t show up.

Today, HomeHero has more than 800 caregivers in its network, up from about 100 this time last year, according to the company.

The average cost for HomeHero’s in-home services is $18 an hour, or $180 a day, which Hill estimates is about 40 percent lower than the industry average. Of that, HomeHero takes a 15 percent cut, its primary source of revenue. The company now operates throughout Los Angeles and just launched in San Diego in April. The goal, Hill said, is to eventually offer caregivers nationwide.

“I don’t want to put anybody out of business,” he said, “but I think that (traditional) model should die.”

– Cale Ottens

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