Successful CMOs achieve growth by leveraging technology. Join us for GrowthBeat Summit on June 1-2 in Boston
, where we'll discuss how to merge creativity with technology to drive growth. Space is limited. Request your personal invitation here
Care.com is going public.
The company, which connects caregivers with people who need care, aims to raise $80 million in its IPO on the New York Stock Exchange.
Care took advantage of a JOBS Act provision which lets companies confidentially file IPO-related documents. This allows them to keep the lid on their financial information a little longer and negotiate with the SEC in private before opening the gates to public scrutiny.
Rumors about Care’s public offering have circulated for months, and the news is finally out.
Let the scrutiny commence.
Care.com connects families to caregivers, giving them easy access to people who can help them take care of their kids, elders, pets, and homes. Caregiver profiles contain basic information about credentials, as well as options to request background checks, contact references, and interview candidates.
The site now has 9.5 million members across 5.1 million families and 4.4 million caregivers. It attracts 6.4 million unique visitors a month, and a new job is posted every 30 seconds. Care also gives employers access to the platform and works with over 600,000 employer-sponsored families.
Care has experienced “rapid growth” in revenue and members. In September 2010, it had 1.9 million members. Three years later, it has 9.1 million, representing 70 percent compounded annual growth. Revenue grew from $12.9 million in 2010 to $48.5 million in 2012, representing 94 percent compounded annual growth. Revenue for the nine months ending in September totaled $59 million, an increase of 81 percent from the same period in 2012.
Care still saw a net loss of $20.4 million in 2012 and said that it expects to continue having operating losses as it grows the business. It also said it may not maintain the current rate of revenue growth.
Even though Care was founded in 2006, the company said it is still “early in the penetration” of the addressable market.
Its target market includes all households with income greater than $50,000 and 15 percent of households with income less than $50,000 and which have either a child or senior. The census showed 42 million households that fit this description in 2010; and IBIS Research found that in 2012, $243 billion was spent in the U.S. on care, including day care, in-home care providers, housekeepers, nursing care facilities, tutoring, and pet care.
Care said in the filing that the care market is large and highly fragmented:
“Traditional alternatives employed by families, including word-of-mouth, directories, job boards, and placement agencies, generally suffer from one or more of the following limitations: limited reach, lack of a comprehensive solution to address diverse and evolving care needs, and high cost. These traditional alternatives also typically do not provide a convenient way for families to manage the financial relationship with their caregiver. In addition, caregivers and care-related businesses lack a cost-effective way to promote their services, to target families at scale and, in the case of care-related businesses, to recruit caregivers efficiently.”
Care aims to capture this market by providing a more convenient, user-friendly way to find and book care. It said its platform is more efficient, reliable, cost-effective, and comprehensive than the existing solutions. It also satisfies a need for caregivers who need ways to professionally publicize their services and find employers.
It makes money from fees that providers pay to be listed, monthly fees for online subscriptions, referral fees for companies that offer off-site services, and revenue from corporate customers.
“In order to grow our membership, we intend to increase our investments in various marketing channels, including television, online search, and community groups and forums, to increase brand awareness in the United States among families and caregivers. We also intend to increase our member base by selling our services to more employers who will offer our platform as a benefit to their employees,” the filing said.
Care also plans to introduce new products that at targeted at recurring revenue, such as its new Date Night product, and create more payment solutions, such as the new HomePay tool, which automatically calculates and tracks all tax withholdings, provides easy payroll tools, and prepares federal and state tax returns.
Care is active in 16 countries and 7 languages and is also looking to deepen its footprint abroad.
It made a big push for international expansion in 2012, launching a UK arm and acquiring Besser Betreut, Europe’s largest care portal. It also raised $50 million led by Institutional Venture Partners (IVP) and supported by Matrix Partners, New Enterprise Associates, and Trinity Ventures, bringing its total capital raised to $111 million.
Care is based in Boston.
Care is a global need without geographic or demographic boundaries. At some point, every person and every family will have care needs, be it for children, seniors, pets or even homes. Our mission is to improve the lives of families and... read more »
Powered by VBProfiles
VentureBeat’s VB Insight team is studying marketing analytics...
Chime in here, and we’ll share the results