Investments Even Out And HopSkipDrive Cruises To $10.2M

While there are any number of services that have tried to offer the “Uberized” version of almost every service — dry cleaning, dinner delivery, grocery shopping, the list is almost endless (for now) — attempts at offering the same service, though pitched at a somewhat different audience, have been fewer, further between and harder to make work.  

But the team at HopSkipDrive is hoping to be the exception to that rule with their new service, which they rather proudly tout as “Uber for kids.” And with $10.2 million in Series A funding, they are starting to put together the war chest to do it.

Pitched primarily at the busy parents of children over the age of 7, the service offers a very simple service: allowing parents to pre-schedule pick up times for their offspring from a very, very heavily screened and vetted driver.  

Ridesharing for kids is a very distinct and in many ways wholly different animal than adult-facing ridesharing. That means background checking for a wide variety of issues, vehicle inspections, fingerprinting and ongoing DMV spot checking,

Founded by Joanna McFarland, Carolyn Yashari Becher and Janelle McGlothlin, the services calls its contractors “CareDrivers” — and their primary function is moving children between activities and home.

The new funding round, led by FirstMark Capital, saw additional participation from new investors at Greycroft Partners and Pritzker Group Venture Capital. Existing investors included Upfront Ventures, BBG Ventures and 1776. FirstMark was also involved in the firm’s $3.9 million seed round in July.  

“Demand has grown even faster than expected,” CEO Joanna McFarland noted in an interview. “We’ve built a strong product and technology team, and are now adding outstanding talent on the operations side. With this new capital, we are uniquely positioned to continue delivering our trusted service while we scale and bring our solution to millions of families in Southern California and beyond.”

So far, HopSkipDrive is in its early days, and the service is only open for business in Los Angeles County. Now, that is a big area, containing roughly 10.2 million people — but it’s still a limited one. And though they report having given out “tens of thousands of rides” to satisfied customers so far, the reality is that number is rather small when stacked up against the billions of rides that the luminary names in ridesharing have given out.  

But, for now HopSkipDrive thinks it has found it a niche that will be hard to break into. Offering rides is easy, but very few parents in their right mind would pack their child into an Uber and hope for the best.  

And HopSkipDrive is not kidding around on the security front. All of the drivers must have at least five years of childcare service experience, and aside from the background checking and fingerprinting, drivers are TrustLine certified.

TrustLine is the highest standard of childcare certification in California.

Drivers photos are sent to families in advance of the pick up, with a code word for the ride, so the child being picked up can identify the driver. That data is also relayed to the pick up location. If the image doesn’t match or the driver doesn’t know the password, no pick up happens. And parents can track the driver all through the ride via the mobile app.   

The vetting and promise of security is a selling point as well as a potential big barrier for entry for anyone else trying to market to the notoriously cautious, affluent working parents marketplace. Which might just buy HopSkipDrive the time it needs to build out more impressive scale.

Especially considering that those who use the service are using it a lot, if internal data is to be believed. McFarland noted that the  “thousands of families” currently signed on to the service are now using it several times a week. The top 25 percent of customers are using the service several times a day.

And HopSkipDrive is getting serious about its staffing. Along with the funding, the firm announced Eyal Gutentag will be their new COO. Gutentag’s last gig (in the gig economy)?

General manager of Uber’s Los Angeles operations.

So keep those eyes open. Today, HopSkipDrive is a small LA startup with 100 1099 drivers, $14 million and an idea that at first blush looks like something a lot of others came up with already.

But, if they found the right value added for parents who need care help, but not full-blown childcare, they might just have a way to out-Uber, Uber itself.  

Investment Tracker For Week Ended 1-22-16

Investment activity was decent in the week that ended on Jan. 22, with $684 million in total deal activity, though notably below the previous week’s $1.1 billion tally. The FinTech sector ruled yet again, with the bulk of activity in the period.

But in contrast to the middle of the month and the week that ended on the 15th, deals were a bit more evenly spaced, where no single behemoth transaction dominated the fund flows. In fact, this time around, there were a few transactions that comfortably passed the $100 million mark and above. The biggest of those deals came with the announcement that FireEye is buying iSIGHT Partners for $200 million, in a deal that will boost FireEye’s cybersecurity portfolio with the addition of the latter firm’s threat intelligence technology. In the next transaction on the rung, the consumer loan company WeLab, which is based in Hong Kong, grabbed $160 million in seed financing. The company provides consumer loans in China and Hong Kong through online and mobile conduits. The funding is being earmarked to continue growth in China. LendUp, a little lower on the list, received $150 million in Series B financing, which is tied to growing both scale and also the company’s credit facility. The funding round had been led by Susa Ventures, among several others, and LendUp will continue its push into banking for the underserved, with a pending launch of the L Card. The company has said that card will be able to help set budgets for purchases ranging from gas to groceries. Below are the “Top 5” investments for the week as ranked by deal size.

The rather even pacing of the week might indicate the investors are coming back to the fray after worrying about unicorn status and all manner of slowing economies – and it is interesting to note the relative size of the investment in WeLab, intended to serve the Chinese consumer, who has been a focal point of worry for many investors. As we know by now, dealmaking can be lumpy across the Investment Tracker, week to week, and it is probably too early to read anything defining in either the week’s aggregate activity or any one deal.