HomeHero

» see homehero.org as it lived, on the wayback machine

~ the obituary ~

Kyle Hill and Mike Townsend started HomeHero in Santa Monica in 2013, aimed at one of the uglier problems in American life: an adult child three states away trying to arrange care for a parent who should not be living alone. The usual route was a phone call to an agency, and then a stranger standing at the door. HomeHero let families watch video interviews with caregivers before choosing one, then book and manage the arrangement online.

It worked well enough to raise $23 million. The cap table had Graham Holdings on it, along with Social Capital, Science Inc., Tencent and Cedars-Sinai. Newspaper money and a working hospital on the same line is not a common sight. The company called its caregivers Heroes and onboarded about 1,200 of them, across Santa Monica, Orange County, San Diego and San Francisco. Within its first year it had booked more than a million hours of care.

The recognition followed the way it does. HomeHero took the Webby for best employment website in 2014, and in 2016 both founders turned up on the Forbes 30 Under 30 list for healthcare. In February of that same year the company terminated its working relationships with ninety-five percent of its caregivers.

Those two facts belong to the same year and they sit together fine, because the second of them was ordered by the federal government.

~ the case file ~

~ the home care rule ~

The Department of Labor had been working for years on closing the companionship exemption, a carve-out that kept more than two million home care workers outside the Fair Labor Standards Act. In October 2015 an appeals court upheld the new rule and the exemption was gone, which meant home aides were owed minimum wage and overtime like anyone else. On the merits this is hard to argue with. Home care is among the lowest-paid work in the country and the exemption existed because the job was once imagined as neighborly favor rather than labor.

The rule did not reduce the demand for care. It removed the margin from the only model HomeHero had. The company could no longer treat its caregivers as independent contractors, so it moved them onto W-2 employment, and Hill's accounting of what that cost is the number worth keeping: bringing on a single caregiver became ten times more expensive. He wrote afterward that HomeHero had lost its core identity the day it was forced to make the switch, and described the employment model it was left with as inferior for what the company was trying to do.

~ pilot fatigue ~

The escape route was supposed to be institutions, the standard second act for a healthcare startup running low on unit economics. If consumers were too expensive to serve one at a time, sell into health systems and hospitals instead. Hill named the failure of that plan with a phrase worth stealing. Pilot fatigue: the discovery that most of the pilots his team kept winning were constructed to produce case studies rather than contracts, and that the odds of any of them becoming recurring revenue were slim.

The whole fight is a specifically American one and it needs saying plainly from outside it. Elder care in Turkey runs on family labor first and on informally hired help second, with no venture-funded layer ever built between the two. A question about whether a caregiver counts as an employee has never been large enough here to take a company down with it.

~ the brand after the company ~

On 24 February 2017 HomeHero announced it was ceasing operations and leaving the industry altogether, with Hill saying the team would go and build something more sustainable in healthcare outside home care. His closing line to the press was that big fundraising rounds should not be mistaken for market success.

The assets did not sit idle. Toward the end of 2018 a company called Family Directed, launched that year with backing from former Almost Family chief executive William Yarmuth, bought substantially all of them and announced it the following June. Its president told the trade press that as of midnight the HomeHero website no longer existed and everything pointed at Family Directed. The plan was to relaunch the enterprise product under the HomeHero name with a network of nearly ten thousand caregivers, and with one deliberate change: families would choose for themselves whether a caregiver was a contractor or a household employee. The buyer kept the brand and designed out the thing that had killed it.

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