Marketplaces are inherently hard businesses to start, build and nurture. There is no magic formula for seeding supply and demand, and maintaining the right balance between both sides is a source of constant consternation. Nonetheless, we have been actively investing in platforms that we believe have the potential to emerge as market leaders across a variety of verticals and industry segments. From B2B (AppDirect) to B2C (BusBud and Luxury Retreats) and even B2D (Crew), we have seen numerous approaches to scaling a business in this space. The key to success in all these businesses is not simply taking market share away from existing competitors – rather, it’s growing the size of the market itself. Market growth often results from a maniacal focus on two things: 1) removing friction from the experience and 2) concentrating on an underserved element of the buying or selling population.
That may seem like an obvious observation, but the non-obvious corollary to that is that it is often folly to estimate the size of an opportunity based on the relative scale of an incumbent. The right team with a focused approach on the aforementioned elements can often also leverage existing market awareness to leapfrog ahead of competition in relatively short order. We’ve seen the power of momentum play out over and over again in our best performing investments, many of which are already a multiple of size larger than their initial market incumbents. It’s a story we expect to play out again in our latest investment, CareGuide.
CareGuide is a family of online marketplaces for senior care, child care, pet care and home care services. The Company is led by a group of experienced entrepreneurs who quite simply are not playing for second place. John Philip Green, Brian Sharwood, Jesse Rasch and Ed Lui combine tremendous hustle with raw intellectual horsepower. This formidable brain trust serves as a great foundation upon which to build a business. A convergence of several large demographic movements (aging population, two income households, increasingly fluid workforce, etc.) and technological trends (mobile, on demand, reputation-based) provides the catalyst for growth. CareGuide’s near religious zeal for broadening its value proposition for both sides of the market allow it to differentiate from stagnant and/or narrowly focused competition. Finally, this round of financing helps accelerate already-promising market traction and reinforce existing investments in an aggressive product roadmap. You can also expect to see some additional properties added to an already robust list: Sitter.com, Housekeeper.com, PetSitter.com, ElderCare.com and HouseSitter.com
What is especially interesting is the fantastic syndicate of co-investors (https://angel.co/careguide/fundraising) that have also stepped up to support the Company. CareGuide’s cap table already includes a number of existing iNovia founders, executives, and even LPs (10 by my last count). When a group of entrepreneurs of this caliber coalesces around a unique opportunity, it’s usually a good one. Of course, we’ve already seen the evidence first hand – and the numbers don’t lie. We are very pleased that John has given us the chance to invest further into his vision, and look forward to watching him lead CareGuide into another phase of remarkable growth.