Digital marketplace Lottie raises £2.5m to transform the search for residential care
A young British business owner who was declared “Britain’s best boss” after he let his staff have the day off on full pay when lockdown restrictions lifted last year has raised £2.5M in seed funding for new elderly care search platform, Lottie, just six months after winning initial backing off Monzo’s founder to launch it.
Exasperated by their own experience of searching for a care home for their Grandma, entrepreneur Chris Donnelly and healthcare expert brother Will Donnelly, launched Lottie in July 2021 - a free digital healthcare marketplace, helping families minimize the time, stress and cost of finding quality compassionate care homes.
In a round led by early stage venture capital firm Kindred, the brothers secured investment from angel and Zoopla executive, David Wascha as well as former Airbnb and Facebook director, Caroline Hudack. Tom Blomfield and Lendable co-founder Victoria van Lennep also reinvested.
Raising £3m to date with a £27.5m valuation, Lottie’s fresh injection of capital comes just days after American counterpart, A Place for Mom, announced a $175m funding round, led by Insight Partners, and $1+bn valuation.
The UK elderly care sector comprises 12,500 care homes with a combined total of 480,000 registered beds. A rapidly ageing population means the category is currently forecast to be unsustainable beyond 2028 without increased investment and new technology innovation.
After an impressive near-five-fold increase in staff since November 2021 (4 - 22 employees), the social impact business is going from strength to strength. Lottie has grown its market place from 200 properties in London and the South-East of England, to over 1,000 quality-focused facilities across England.
Detangling the complicated and confusing landscape of social care, the company has helped 1.000s of families so far, while their concierge service has assisted over 200 people in later life start a positive new chapter - collecting a flawless record or five star reviews along the way.
The new funding will be used to supercharge Lottie’s marketplace expansion and care concierge services across the UK, as well as extending the company’s offering to the independent living sector - a market forecast to grow due to the rising demand for age-fit accommodation from the 55+ population.
Neatly straddling the on and offline world, Lottie has a team of friendly advisors who can handle the whole care home search process from researching facilities, discussing care requirements, negotiating residency fees as well as overseeing the legal process.
The investment will also go towards building the business’ expert team of local care and technology professionals in addition to developing the technology to make it even simpler for new care seekers to navigate the website.
Establishing himself as one of the UK’s leading social care advisers, Lottie co-founder and self-confessed “Care nerd and property expert” Will Donnelly spent 5 years at CBRE, where he advised on £2.5bn of healthcare transactions, while supporting the NHS during COVID-19.
He said “Finding a high-quality care home is complex, time-consuming and incredibly stressful, with nearly half of families regretting their decision.
“Chris and I believe there is a different way. We’ve flipped the industry dynamics to challenge the market’s long-standing status quo. Lottie was built first and foremost to champion and support care seekers, not other key sector stakeholders.
“Most first-time care choices take place following a sudden illness, injury or loss of carer, meaning decisions are often made urgently and under distressing circumstances - an emotional process, which requires real human expertise and support.
“While technological innovation will always be at the heart of Lottie, people play a vital role.
“It’s our customer care team, who are experts in the field of care and there to support customers for free, from the moment they first visit Lottie, through to move-in day.
“They are the people delivering our 5* customer service, which ultimately sets us apart from the rest of the market, and why customers have been so receptive to our service.
Care home fees across the UK are also something of a postcode lottery. According to the consumer website Which? the average cost of a residential care home in 2019-20 ranged from £551 a week in Northern Ireland to £858 in Scotland. That’s a difference of £307 a week, or almost £16,000 a year.
And it’s not just a question of which country you live in – there are big differences from region to region. On average, residential care in a nursing home in the South East of England costs 44% more than a nursing home in the North East.
“Our customers don’t want to wade through 1,000s of under-par care homes, or see overpriced facilities out of their budget.” continues co-CEO and Forbes Europe’s 30 under 30 alumni, Chris Donnelly.
“Lottie uses its collective power and market intelligence to secure exclusive offers with our care home partners, which have been helping families to save an average of £5000 in fees.”
At the heart of Lottie is curation and tackling the paradox of choice. The care homes listed are handpicked and vetted by the company’s team of care experts based on their care quality, customer reviews and ethical practices.
Lottie’s co-founders also have their eyes set on enhancing the intuitiveness of the platform through the incorporation of artificial intelligence in the future.
“Social care is at a crisis point, and this has only been exacerbated by the effects of COVID-19 on the sector. There has never been a more important time to breathe some new life into the sector and help improve the quality of life for families and their elderly loved ones.” added Chris Donnelly.
“Just recently an investigation by the Guardian shone a stark light into the substandard care of hundreds of UK dementia care homes, with one in five rated as ‘inadequate’ or ‘requires improvement’.
“Lottie is a unique hybrid of matchmaker, comparison website and care property specialist. Blending smart technology with human expertise, we hope the platform will become an indispensable ally in helping people make easy informed choices about elderly care.
“The marketplace is just the start of our vision for the later living sector, we see it as a springboard to improve the global sector as a whole: from consumer transparency, technologies inefficiencies and lack of high quality data insights.”
Elderly people and their loved ones are given the freedom to design their ideal care package. Lottie then distills millions of data points on care homes to help people find the perfect home that meets their needs, wants and budget.
Maria Palma, General Partner at Kindred comments, “Sorting care for aging family members is one of the most crucial decisions you make, and yet the current process of finding a home or knowing your options is broken, fragmented, and leaves little peace of mind about the quality of care your loved one will actually receive.
“I'm incredibly excited to be backing the Lottie team, who have a killer combination of relevant experience in the sector and deep passion for improving the standard of care.”
