Turning the "Shared Sons" concept into a multi-billion-dollar business, Papa in the US has ignited the elderly companionship economy.

Preface

As the Double Ninth Festival arrives again, when we refocus on the traditional issue of "companionship for the elderly", Papa, a senior care platform across the ocean, has offered a new solution to the loneliness dilemma of the contemporary senior population with its "shared sons" companionship model.

In 2017, Andrew, the founder of Papa, discovered while caring for his grandfather with cognitive impairment that what his grandfather truly needed was a "friend", some companionship, and occasional help. Thus, Papa was founded.

As a platform connecting part - time college students with elderly people in need of help, Papa combines the "silver economy" with the "loneliness economy". It addresses the two - fold needs of the senior care industry lacking manpower and college students lacking money. It doesn't provide substantial services itself, which significantly reduces costs in terms of human resources and other aspects.

At that time, the total number of elderly people aged 65 and above in the United States was approximately 48.8 million, accounting for 14.94% of the total population, indicating that the country had entered a deeply aging society. Moreover, 42% of American elderly people owned smartphones, showing a certain degree of digitalization, which laid a good foundation for the promotion of Papa's online services.

In addition, after half a century of development, the U.S. Medicare program had become relatively comprehensive, covering all elderly people aged 65 and above in the United States and alleviating their financial burden, leaving them with more disposable income. Research at that time showed that in the next 15 years, the elderly aged 60 and above in North America would be the main driving force for consumption growth, expected to boost consumption by over 45%.

A 2015 survey by the Pew Research Center showed that only 28% of adult children had provided financial support to their parents in the past year, but this proportion reached 60% in terms of daily life assistance such as household repairs.

It's evident that American elderly people at that time were relatively well - off financially, and they needed more spiritual companionship and simple daily help. Papa was founded based on this need.

PART 01

Valued at $1.4 billion

Turning the "loneliness business" into a unicorn

In 2017, due to his busy work, Andrew found a patient college student friend on social media who could accompany his grandfather with cognitive impairment in his spare time and provide some daily help.

In the same year, Papa was founded in Miami, Florida, standardizing the process of Andrew's search for a companion for his grandfather. Papa clearly defined the boundaries of services and screened the college students providing services. Elderly people in need of help and their children could post their needs on the platform, and college students who passed Papa's screening (referred to as "papa pals") could choose the elderly they could assist and receive payment. Papa charged a brokerage fee in this process.

The operation mode of Papa. Image source: Papa's official website

The help that elderly people can get from Papa is often non - medical, such as preparing meals, transportation, companionship, and cleaning the room.

At that time, the home care market in the United States was approaching saturation, and capital showed some interest in the differentiated emotional companionship services provided by Papa. In April 2018, Papa received an $810,000 seed - round investment from Y Combinator. In October of the same year, it completed an angel - round financing of a total of $2.4 million from two other institutions and then expanded to five other states including Florida and Pennsylvania.

In September 2020, Papa completed a $18 million Series B financing, and its service area expanded to 17 states and would continue to expand to four other states.

In 2021, after completing a Series D financing, Papa was valued at $1.4 billion, with a cumulative financing of $240 million, and entered the unicorn club.

From the initial $810,000 seed - round financing to the $150 million Series D financing, the continuous investment from institutions such as Canaan Partners and Initialized Capital demonstrated the high recognition of the capital market for the "shared children" business model and also enhanced the company's credibility and resources. During the U.S. pandemic, the number of Papa members increased by 500% year - on - year.

Data shows that the elderly population in the United States will increase to 80 million by 2040, with a shortage of 11 million family caregivers and 355,000 paid caregivers. Papa believes that by connecting young people who are short of care experience but in need of extra income with elderly people who need companionship and daily help through the platform, it can fill this gap to some extent.

After 8 years of development, as of the end of 2024, Papa had provided over 2.6 million services.

PART 02

Using "non - medical companionship"

To redefine the boundaries of senior care services

Papa is essentially an online platform that aggregates college students with free time and a willingness to serve the elderly on the Papa platform. It conducts qualification reviews on applicants and matches qualified caregivers with elderly people in need of care.

The core innovation of Papa lies in breaking away from the traditional "physical care" service scope in the silver economy and focusing on non - medical companionship to address the long - neglected emotional needs of the elderly.

The services provided by Papa include daily companionship, transportation, house cleaning, gardening, meal preparation, pet care, etc. It matches papa pals with corresponding skills to elderly people according to their specific needs for in - home services. In addition to basic home services, Papa also actively seeks cross - industry cooperation to provide services beyond the "home" scenario for the elderly.

For example, in October 2021, Papa announced a partnership with Uber Health. Papa's care coordinators can directly coordinate transportation for Papa members or Papa Pals through the Uber Health platform, providing passenger or cargo services.

In addition, Papa has a remote social care navigation team consisting of social workers, registered nurses, case managers, and nutritionists, which can help patients solve social problems they encounter.

Types of services provided by Papa. Image source: Papa's official website

Children or elderly people can post care needs through phone or the online platform. Elderly people in need of care are called "papa". College students who want to provide care need to apply to become "papa pal" (literally translated as "dad's buddy"). After safety training and background checks, they can serve the elderly in need of help on the platform. Papa additionally requires papa pals to have a driver's license and a vehicle to provide transportation and errand services for papas.

Transportation is included in over 30% of Papa's service records, with an average rating of 4.9. Transportation services are important for the elderly, but emotional value is the key to the high rating.

Regina became a papa pal in November 2023 and has completed over 700 services so far, becoming the "preferred" Papa Pal for many Papa members, including Deborah. For Deborah, transportation services are not just about taking a ride. Every time, she and Regina have long conversations, talking about growth, family, music they listen to, past experiences, and school.

To provide a better service experience for the elderly, Papa has set relatively strict screening criteria for papa pals. It requires college students applying to be papa pals to live in the service community and conducts a series of behavior assessments, requiring them to provide sufficient companionship and emotional value to the elderly.

According to Papa's disclosure, less than one - third of college students can pass the screening. Although the official website emphasizes that "no professional care knowledge is required to become a papa pal", in fact, nearly half of papa pals have care experience.

Corresponding to the high standards, papa pals who pass the screening and provide services can earn $13 - 18 per hour, plus commuting subsidies and some bonuses, which is very attractive to college students. If they complete 100 visits, they will be upgraded to star caregivers, and Papa will recommend high - quality elderly people to star caregivers, so star caregivers will earn more.

Requirements for papa pals by Papa. Image source: Papa's official website

On the Papa platform, caregivers and members are determined through a two - way selection mechanism. Papa pals can choose the members they want to serve on the platform. Meanwhile, if a Papa member is satisfied with a certain papa pal during the service, they can list him as the "preferred" papa pal. As long as the caregiver is available at the appointment time, they will serve the "preferred" member.

Papa attaches great importance to safety and boundary issues in services and has relatively clear regulations on what services include and exclude. For example, in companionship services, it stipulates that companionship does not include anything that requires physical contact between papa pals and members, such as bathing, using the toilet, dressing, brushing teeth, feeding, or massage; papa pals are not allowed to provide services to members outside the Papa platform; and they are not allowed to talk about any topics that make members or papa pals uncomfortable, etc.

PART 03

Profit model:

Insurance payment + Elderly payment

Papa doesn't directly provide tangible services but charges through the platform. On the one hand, Papa directly targets C - end users, acting as a matchmaker between elderly people in need of help and college students and charging brokerage fees. On the other hand, Papa has partnered with the U.S. Medicare program, MA program, and many commercial insurance companies to provide emotional companionship services for commercial insurance customers.

Data disclosed by Papa in May 2024 showed that receiving Papa services could significantly reduce the medical expenses and insurance claim amounts of the elderly: the medical expenses of members who visited Papa once or more decreased by 9%, the number of hospitalizations decreased by 18%, and the use of professional care facilities decreased by 22%; the medical expenses of members who visited Papa more than twice a month decreased by 19%, and the medical expenses of members who visited Papa more than three times a month decreased by 30%.

Benefits brought by Papa services. Image source: Papa's official website

The combination of the "silver economy" and the "loneliness economy" is not a new topic. Many silver - related enterprises at home and abroad focus on the emotional needs of the elderly.

The Japanese company AgeWell Japan focuses on "active aging" (Age - Well), precisely matching services through data analysis. Young people provide non - medical interest companionship and social support services at home. The American company Tombot launched an AI bionic robot in the shape of a Labrador puppy, providing a realistic pet interaction experience without the trouble of actually raising a living pet.

Similar to Papa's platform model, another American company, Honor, is known as the "Uber of the care industry". Honor initially provided care services directly to the elderly and built an online platform to help caregivers quickly match with users. However, the U.S. senior care industry at that time faced problems such as a shortage of caregivers and difficulties for enterprises to expand the market.

To avoid these problems, three years later, Honor shifted from 2C to 2B, using its technological advantages to provide services to peers, the elderly, and their children, including caregiver recruitment and training, health monitoring, supply - demand matching, etc. Currently, Honor is valued at over $3 billion and has attracted over 100,000 caregivers through the "gig economy" model.

Conclusion

Due to differences in social concepts and willingness to pay, the Papa model is difficult to directly replicate in China. Currently, the silver - haired population in China has a strong willingness to pay for rehabilitation, nursing, and light medical assistance (such as medication reminders and accompanying to medical appointments) that are strongly related to medical care, and non - nursing major college students may not be able to meet some of these needs.

The most crucial aspect is trust building. In the United States, Papa relies on a mature social credit background investigation mechanism. If the "college students taking orders" model is implemented in the Chinese market, it is necessary to graft existing traditional trust carriers such as community organizations, neighborhood committees, and universities to conduct joint certification and recommendation to make up for the lack of trust in online communication.

However, the emotional needs of the elderly should not be ignored. Domestic senior care - related enterprises can include emotional companionship in their service scope and use quantitative data to prove to partners such as insurance companies its long - term value in reducing medical expenses and improving the mental health of the elderly; or they can offer corresponding self - paid services for the elderly in need, providing a safer and more reliable way of emotional companionship for the elderly.

This article is from the WeChat public account "mx814765531" (ID: AgeClub), author: AgeClub, published by 36Kr with authorization.