Led by SoftBank Vision Fund 2, the round will ensure Papa continues scaling its solution across health plans nationally
Papa, the Miami-based health-tech startup that matches older adults with trained “Papa Pals” to combat loneliness and isolation, has been on a roll this year scaling its innovative solution across dozens of the largest health plans across the nation. Today, Papa announced it has raised $150 million in funding, one of the largest rounds in #MiamiTech this year.
The homegrown startup is now a unicorn with a valuation of $1.4 billion. Its $150 million Series D funding round was led by SoftBank Vision Fund 2, new to its cap table. Participating in the round were TCG, Tiger Global Management, Canaan, Initialized Capital and Alexis Ohanian’s Seven Seven Six fund. Its new round, on the heels of its $60 million Series C announcement led by Tiger Global in April, brings Papa’s total funding to $240 million.
This growth comes amid significant investment from health plans to address members’ social isolation and loneliness, which have been shown to have a direct link to negative health outcomes. Its 25,000 “Papa Pals” provide critical companionship for older adults while also helping them and others who need support services with critical day-to-day tasks ranging from social activities, household help, local transportation needs, technology literacy and more. The company’s slogan is, appropriately, “Family on Demand.”
Papa recently added more than two dozen health plans since April, including Cigna, which will begin offering Papa starting Jan. 1, 2022 to 70,000 members in nine states. It is now collaborating with more than 65 health plans serving members covered under Medicare Advantage, Medicaid, and employer health plans, Indeed, the startup founded by Andrew Parker has grown by 333% year over year, and now it is set to scale farther.
“On average, every two minutes in the United States a Papa Pal starts a companionship visit with a Papa member. That figure will dramatically increase when an additional 26 health plans start on January 1, and as more plans and employers add Papa over time,” said Parker, Papa’s CEO, who named the company after his grandfather whose quality of life markedly improved after his family hired a “pal” to assist him.
“The collective physical, social, and emotional benefits of this companionship are vast, and the opportunity to reduce loneliness and to support health where it happens — at home — is boundless. This latest round of funding, along with an ever growing number of Papa clients, underscores the power of Papa’s approach and, even more so, the power of human connection,” Parker’s statement continued.
Research conducted by Cigna using a tool called the University of California Los Angeles Loneliness Scale found loneliness has been growing at “epidemic levels” among American adults during and even before the COVID-19 pandemic, and in 2020 61% of Americans the research team surveyed reported feeling lonely. Loneliness is directly impacting mental and physical health, including fueling substance abuse and men are more likely to be impacted by loneliness than women, the health insurance giant found.
Papa says its solution reduces loneliness by 68 percent. What’s more, Papa reduces healthcare costs: Lonely people have been shown to use the hospital 60 percent more than others who don’t self-identify as lonely, the company said.
In an interview with Refresh Miami today, Parker said what’s exciting is that Papa has gone beyond only helping older alduts to helping entire families, particularly ones without the access to transportation or internet and “are just in a very bad place,” Their Papa Pals have identified signs of conditions that families were not even aware of, he said, and Papa also recently partnered with Uber Health to further ensure transportation is not a barrier to timely doctor visits or meaningful social experiences.
“Loneliness amongst older adults is one of the largest public health challenges and creates a crushing human and economic cost,” said Lydia Jett, partner at SoftBank Investment Advisers and Papa director, in a statement. “Against a backdrop of health care provider shortages and an ever growing understanding of social needs as health needs, Papa is using technology to create a new care force to provide companionship and support to those who need it most. We are thrilled to partner with Andrew and the Papa team to help older adults and families connect to vital social care.”
Parker founded Papa in 2017 as a consumer app before pivoting to an enterprise model in recent years. Papa and its Papa Pals now serve health plan members in all 50 states, across Medicare Advantage, Medicaid, and employer health plans. Papa has 500 employees, and about 180 of them live in South Florida, Parker estimated.
Ohanian was an early believer in Papa’s mission.
“I seeded [Papa] 3 years ago when plenty of Silicon Valley VCs disregarded #MiamiTech or slept on #ElderCare as a market. Hard to believe, but true! Glad to be investing alongside [Parker] again with this latest unicorn round. This is #MiamiTechExcellence,” Ohanian tweeted this morning.
With the funding, Parker said Papa plans to continue its expansion in health plan markets, plus continuing to build out its platform, particularly its data and AI capabilities.
“We started to develop some interesting ways to understand members’ needs from a personal perspective and I actualaly started using AI, not as a buzzword, but to provide a personal experience to a member to improve their health outcomes,” Parker said.
International expansion? “I would love to go international, but we’re not making a rush decision. The way we see it, pretty much every American in the United States should have access to a Pal. It doesn’t mean everyone will need it all the time but when they do, we want to be there so we have a lot of work to do,” Parker said. “There are huge opportunities across the world and we are keeping an eye on all that.”
This year Papa opened a new headquarters in downtown Miami. It was important to Parker that the new Papa HQ make a statement reflecting the homegrown Papa’s commitment to #MiamiTech in the Magic City. The HQ recently added a lounge vibe to the rooftop, now that this weather is getting better.
“This is so awesome to continue the Miami story. We’ve been there from the beginning and I am proud to be among the group of locals helping to put Miami on the map,” Parker said. “Papa will continue to place our flag in the ground as a Miami-based company.”
By the way, this homegrown startup is also hiring. At this time, the company has 34 roles advertised on its careers page. Papa recently announced several new faces on its executive team, including a CTO, CMO and a Head of People and Culture.
This report has been updated. Follow @ndahlberg on Twitter and email her at [email protected]
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