Grandkids-on-demand startup Papa has raised $10 million in Series A funding, pushing the Miami-based company’s total funding raised above $13 million.
The recent investment round was led by Silicon Valley-area venture capital firm Canaan, with money also coming in from Sound Ventures, Y Combinator and Pivotal Ventures, a firm created by Melinda Gates. Past big-name investors also include Alexis Ohanian, the co-founder of Reddit who is also a managing partner at Initialized Capital.
The investment will help strengthen the company’s existing presence while also expanding its national footprint, according to Papa founder and CEO Andrew Parker.
“We’ve partnered with really large health plans like Aetna, Priority Health, Capital BlueCross, Vibra Health Plan, Humana, Alignment [Healthcare] and others, which is essentially bringing us across the nation,” Parker told Home Health Care News. “We’re expanding this work with our large health care partners and bringing our services to more geographies in the U.S.”
Specifically, Papa aims to add 11 more states in 2020, growing from 14 to 25 states in which its services are available. Those services include but are not limited to companionship, transportation, housework and other assistance.
Papa first made waves following its launch in late 2017. Its unique model made headlines and also caught the attention of Humana, one of its early health plan partners.
Specifically, Papa is a membership-based platform that connects college and nursing students (called Papa pals) with seniors in an attempt to address social determinants of health.
In January, the company will have “several hundred thousand” members on its platform, according to Parker.
In the past year, business has been especially booming for the startup. Thanks to that momentum, it now has eight partnerships with large health plans overall, according to Parker.
Recent Medicare Advantage (MA) flexibilities that allow plans to offer non-medical supplemental benefits have acted as a catalyst in partnership development. The Centers for Medicare & Medicaid Services (CMS) first announced it would expand those benefits for the 2019 plan year, then expanded them even further for 2020.
“[MA] is a very big factor,” Parker said. “Not the only factor, but definitely a huge opportunity that we saw in advance and have been monitoring for many years. … We’re excited about the fact that we’re around at a time where health care recognizes the negative impacts of social determinants of health.”
Currently, Papa’s services are mainly available through MA plans, but the company is also exploring new business lines.
“We’re looking to expand into Medicaid, but we’re just exploring that,” Parker said. “Then we also are currently offering our services as an employee benefit, so [in addition to] helping the older adults, we’re helping their family caregiver with respite.”
Employee benefits provider New Benefits is at least one company working with Papa to make it happen. Employees can enroll in Papa and request caregivers for older family members when need be.
The move is in line with a national trend set by corporate giants like Starbucks (Nasdaq: SBUX), Best Buy (NYSE: BBY) and TripAdvisor (Nasdaq: TRIP), all of which have started to offer caregiver employee benefits.
Aside from Papa, popular employee caregiver benefit providers include Waltham, Massachusetts-based Care.com; Burlington, Massachusetts-based Torchlight; Watertown, Massachusetts-based Bright Horizons (NYSE: BFAM); and New York City-based Wellthy.
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