Will Donnelly, the cofounder and CEO of Lottie, wants to make finding and booking a spot in a retirement or care home for an aging family member as easy as finding a hotel stay. In other words, "transform the industry from offline to online," says Donnelly. His biggest challenge? Changing people's perception of long-term care. "I really do want to make care homes cool and something that people are excited about and look forward to," he says. Around 20,000 people seeking care are matched with care homes or other providers for free each month, while organizations pay per qualified enquiry. Donnelly says around 25% of its enquiries come from National Health Service discharge teams and social workers looking to place patients in nursing, dementia and palliative care. But Lottie plans to make the bulk of its revenue through its operating software for senior care providers called Found, which helps those customers manage real-time availability and payment processing, among other functions. Donnelly cofounded the startup in 2021 along with his brother Chris, an alum of the 2020 Forbes Under 30 Europe Media & Marketing list. Lottie has raised $32.5 million in funding from investors including Accel and General Catalyst.
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Category
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LifestyleTranscript
00:00 Will, thank you so much for being here.
00:02 Thank you very much for having me.
00:03 I'm really excited to speak.
00:04 Of course, me too.
00:05 So, talk to me about what was the catalyst that made you start your company?
00:09 Yeah, I mean, I've been, I'm coming up to 10 years in health and social care now,
00:13 and I guess in terms of entrepreneurship and starting a business,
00:17 falling into a family where dad's always did that,
00:20 so as three brothers I think we kind of knew no difference,
00:24 but unlike the brothers who went straight into starting a business,
00:27 I didn't really have that idea or passion to really go after and want to build that huge company.
00:33 Stumbled across a company after university when I was 21,
00:39 doing some work experience in the health care team,
00:41 and that three days turned into five years pretty quickly,
00:46 and yeah, next thing I knew I wanted to start the business,
00:50 because I guess the first week for me of that kind of time at CBRU was the big one,
00:54 which was, you know, it kind of makes me laugh now,
00:57 because when I started, everyone would say to me,
01:00 "God, well, you've really joined the kind of unsexy and uncool part of the company."
01:05 And I was like, "No, like care homes, like old people,
01:08 it's going to be this incredible industry in the future."
01:11 But it just hasn't gone through that kind of digitization process,
01:14 and I guess the other side for me was we went through the process of finding care with my mum,
01:20 and we saw how emotional she was, we saw how it impacted everyone in the family,
01:24 it's a huge financial burden.
01:26 And I guess for me, with my kind of unique experience,
01:30 I kind of was waiting for that, you know, Spotify or Uber type platform to come
01:35 and to really change the industry for the better, and it didn't come,
01:38 and I thought, "Why not me and use my experience and unique kind of, yeah,
01:44 insights of the industry to really go for it and make this industry better for families?"
01:49 Excellent. So break it down for me.
01:51 What exactly does your company do, and how does it improve the healthcare here?
01:55 Yeah, so today, I mean, really simply, we help families understand,
02:00 find, and fund care in the best way possible, later life care.
02:04 I guess what we're doing at the moment is building the world's first ever end-to-end marketplace
02:08 that allows families or other stakeholders, it might be the NHS,
02:12 to instantly book and access care at the tap of a finger,
02:16 like you would on Booking.com or Uber or any of these other apps.
02:20 Excellent. So explain to me your founding story.
02:23 Why did you decide, "All right, I'm going to jump in and start this company"?
02:27 Was it just your mom or...?
02:29 Yeah, I think it was a mixture of my experience being in the industry for five years.
02:34 I think when I was on the kind of M&A side of healthcare,
02:39 where we helped developers, investors, operators, buy and sell businesses
02:43 from care homes and hospitals through to medical centres and cancer units
02:48 and specialist care units, I think over those five years,
02:51 I saw just how broken this industry was.
02:54 There's no transparency for consumers.
02:57 It's technologically completely backward. It's all offline.
03:00 And in the long term, it's completely unsustainable without big changes happening.
03:05 That combined with our own personal experience with our mum,
03:09 we felt there was an opportunity to be that champion for families.
03:13 When you're forced into that decision of care,
03:17 whether your mum's had a fall or dad's suddenly got ill,
03:20 we wanted to be that trusted advisor for families
03:23 to really help them navigate this hugely stressful and emotional time.
03:28 So yeah, that was the catalyst.
03:30 Now, in America, we have things like ZocTalk or other aggregation platforms,
03:35 but here in the UK, was there any other competitor that you faced in this space?
03:39 And if so, how did you set yourself apart?
03:41 Yeah, I guess I kind of described the competitors as these newspapers
03:47 that have kind of been taken online and they were kind of built 20 or 30 years ago
03:51 with no innovation or change.
03:54 And I guess what we really want to do is to put that power in the care seekers' hands,
03:59 so the families' hands who are looking for care.
04:01 Traditionally, 20 or 30 years ago, when you book a hotel, you'd do it over the phone,
04:06 but now it's all in these beautiful digital journeys,
04:09 and that's kind of what we want to do for care.
04:12 It's to bring it online, to make it seamless, to make it super easy.
04:16 And I think the biggest difference will be a family doesn't have to ring seven care homes.
04:21 They can instantly book it at the kind of fingertips themselves,
04:24 whether that's at-home care or looking for a residential care home for mum or dad.
04:29 Speaking of mum and dad, how did your parents feel about you going into this line of work?
04:33 They loved it. I mean, dad's an entrepreneur.
04:37 He's started--you know, he's run a business his whole life,
04:39 so I think any of his sons and all of us have started our own kind of ventures.
04:44 He's always super supportive. I think we have a pretty high tolerance to risk in the family.
04:48 And mum, I think because she had been through it and understood just how emotional
04:54 and time-consuming and taxing and costly it could be,
04:57 she was so excited that maybe her son and Chris, my brother, could fix this issue for families
05:03 and make sure that they didn't have to go through what she went through with her mum.
05:08 Tell me about your fundraising journey.
05:10 How much have you raised so far and what has it afforded you?
05:13 Yeah, so today we've raised £25 million, around $30 million,
05:20 led by two of the world's best venture capital firms, including Accel and General Catalyst.
05:26 I think for us at the moment, we raised our Series A in August last year,
05:30 and what we've always kind of envisioned with that money is, I guess, two things really,
05:34 which is how do we truly build this 10X experience for the customer, for the family,
05:38 who's going through this stressful situation for the first time?
05:44 And for me, that looks totally different than what exists today.
05:47 And once we've built that incredible experience of family,
05:50 is we've made it not stressful and we can help them save money
05:53 and make sure their parents are cared for in the right way.
05:57 We want to look overseas and go to America.
06:00 So we look at what exists in America and we think, again,
06:03 it's kind of these platforms that have been around for a very long time
06:06 with very little innovation and there's no real brand that's supporting families through this decision.
06:12 So being the kind of number one in the UK, which we are today,
06:16 but making that experience so good that it travels overseas really nicely.
06:20 What's been the biggest challenge then to expanding beyond the UK and now the US?
06:25 I think the biggest challenge to date for us was just getting going.
06:29 I think getting access to the venture space and being able to tap into that network is incredibly difficult,
06:36 irrespective of what you've kind of done before.
06:39 I always talk about our biggest turning point was meeting an individual called Tom Blumfield,
06:44 who founded Monzo.
06:46 Before meeting Tom, we got probably rejected by hundreds of investors,
06:51 whether that was angels, venture capital firms, family offices.
06:56 And these are the biggest names or the most common names you see online today in London.
07:01 But no one was willing to take a risk on us and we didn't give up.
07:06 We always thought it was going to be that keep knocking on that door.
07:10 I actually heard Tom speak on a podcast.
07:13 He had just left Monzo and he was speaking on this podcast called Secret Leaders.
07:17 And Dan, who's the presenter, said, "What are you looking to do next, Tom?"
07:21 And Tom said, "You know what? I quite fancy investing,
07:24 and I'm really interested in the health and social care space."
07:27 I texted my brother and told him that, and Chris cold emailed him.
07:32 We'd never met Tom before.
07:34 He was meant to be flying that day, or doing a kind of flying lesson.
07:38 And he said, "Guys, it's raining.
07:40 So if you have a spare afternoon, pop over later today."
07:44 We went over, we pitched our hearts out to, yeah,
07:48 literally told him everything about us and what we had planned for the industry.
07:53 And he was the first person who kind of believed in us.
07:56 And that's going back to COVID times when we first started.
08:00 And he gave us our first big check.
08:02 But it's also just been incredible in terms of network and advising as well.
08:06 He did have two conditions.
08:08 The two conditions of investing were you had to find a technical co-founder,
08:12 and you had to launch within a week.
08:14 And being the excited entrepreneurs we are, we said, "Absolutely, we'll do both."
08:19 We did both, and we launched within the week of meeting Tom.
08:23 That's incredible.
08:24 What do you think it was about your pitch that really sold him?
08:28 Oh, I think he felt the passion.
08:33 I mean, Tom's always looking for people who have unique insights
08:36 on a space that hasn't been transformed or hasn't been digitized or disrupted.
08:41 He did that in the banking industry.
08:43 He did that with GoCardless before.
08:45 I think he felt the combination between Chris and I.
08:48 Chris has been an entrepreneur his whole life.
08:50 He's built and sold businesses.
08:52 He's a digital expert.
08:53 And I guess I brought that health care expertise to the table.
08:57 And I think he just felt how much we cared about the problem we were solving.
09:02 And as you guys will know, building these businesses is incredibly tough.
09:06 And if you don't have that passion or really care about the mission you're building to,
09:10 you give up pretty quickly.
09:12 So I think to get through those tough days, you've got to really believe in what you're doing.
09:16 And I think ultimately we just got on with Tom incredibly well.
09:20 And I think we got in early before we started doing Mass Angel investing as well.
09:24 Very lucky.
09:25 Yeah, it was awesome.
09:27 So how many customers do you have today?
09:29 And how are you looking to grow that in the future besides U.S. expansion?
09:32 Yeah, so on average every month we're seeing around 800,000 people come to our website.
09:38 So using our service, free service for families.
09:41 We partner with just under 5,000 care services in the U.K. and growing incredibly quickly.
09:48 I guess in terms of the future, the U.S. is a huge expansion opportunity for us.
09:53 It's 10X the size in terms of the care industry in the U.K.
09:57 So when we think we've built that platform that really scales overseas, we'll be ready to do that.
10:03 And obviously aligning ourselves with Accel and General Catalyst to the most formidable American investors to do that with,
10:10 we felt we were really well positioned to have success over in the next year.
10:15 We equally want to do some stuff in Europe as well, which will be good fun.
10:18 Excellent.
10:19 How are you using AI in your platform at all?
10:23 Yeah, I think AI is obviously such a buzzword today and everyone is trying to use it in really smart and different ways.
10:32 I think the way we look at it is we're a health tech business that helps families find care.
10:37 So how can we use AI to really drive that kind of search experience for families?
10:43 We have millions of people coming to our website every single month.
10:47 And you start to build lookalike audiences where you get to learn about all these customers.
10:54 And a lot of the customers that come to us are very similar.
10:57 And therefore we can use AI to make much more kind of personalized recommendations based on the experience of past users that we've collected over time as well.
11:06 I guess the other side of AI, which is brilliant, is driving your own internal efficiencies.
11:10 I think one of the things we've done recently is we now use AI to qualify every call that happens on our platform, which previously was done in an incredibly manual way.
11:20 So no longer do we have a team doing those sorts of things.
11:23 And instead they can focus on really kind of high value items and jobs instead.
11:29 Nice. What would it take for you to sell your company? And is that your end goal?
11:34 Yeah, I think Chris and I have gone into this journey with a pretty clear vision of what we want to achieve out of this.
11:41 Chris has sold a business before for close to £30 million.
11:46 And for him, he really wants to build something that's impactful and has that positive impact on the world around us.
11:55 For me, I've been in the industry for 10 years now. It's all I've ever known and loved and wanted to help.
12:00 So for me, it's probably less about the outcome of selling a business.
12:05 It's more about the impact that we have in the industry.
12:08 And for me, success looks like doing what Monzo did to the banking industry or doing what Spotify did to the music industry.
12:13 It's really transforming it and changing the way that families find and book care in the long term.
12:21 I think if we can build the social care of the future that is digital first and really efficient and makes the process much easier for families,
12:29 I think that's success for us.
12:31 And I think the financial outcomes and delivering on behalf of our investors will come because we've done that as well.
12:37 Is it hard now looking into the US trying to navigate a health care system that is just so different than what you have in the UK?
12:45 Definitely. I think there are a lot of similarities that people aren't aware of between the two systems.
12:53 I think both markets have huge privates, both geographies have huge private markets.
13:01 That means that we can really speak to the consumer on a one to one basis rather than having to go through public bodies or the NHS in the UK.
13:09 So I think there are lots of things that we will have to learn and really craft our product and service to meet the US kind of health care system.
13:18 But I think there is also lots of things that we can kind of take from the learnings of building in the UK first and that will translate to the US.
13:25 But still lots of learnings to do before we expand over there at the end of this year and full launch obviously in 2025.
13:32 Excellent. Is there one business rule that you always follow no matter what?
13:38 Yeah, I think in the industry that we work in, kindness really is the heart of kind of everything that we want to achieve at Lottie.
13:45 I think given the topic, it's very taboo and there's so much negativity that goes towards kind of care and people living in residential care homes.
13:55 And I think at the heart of what we do is kindness and making sure that those families who are going through that process are treated with respect and integrity and kindness.
14:06 And that makes their lives a lot easier because they just want to speak to someone. They just want some support during that process.
14:12 I think that also translates to the team that you're building. Given the nature of the mission that we're working on and the company that we're trying to build,
14:20 you attract the most incredibly wonderful and lovely and kind people to your team who are also technically fantastic and phenomenally hard workers
14:29 and really want to do everything they can to improve this industry for families around the world.
14:34 So I think my promise to the team has always been we will treat both our customers and team with that immense kindness.
14:41 But obviously expect a lot from the team as well.
14:44 That's awesome. Are there any other future projects coming up or new tools or anything that you're excited about in 2024?
14:51 With respect to new tools, I think in both the UK and the US industry, there's a huge shortage of data.
15:01 I think as a platform, we get to collect millions and millions of data points every single month,
15:08 which can inform those public bodies of much better decision making in the future.
15:13 I think one of those examples is the NHS. The way that they distribute their funding today is, again, quite ancient and historic,
15:22 and it's not based off probably the amount of data that you would expect.
15:27 So I think taking all of the data that we hold from Lottie, the marketplace, both from a search and both from a demand and supply perspective,
15:35 will really help us make much more informed decisions across the UK and America in the future,
15:41 but also save the government's enormous amounts of money and also families as well.
15:46 Nice. Now I have a big last one for you here, Will. What would you like your legacy to be?
15:51 I think to be the founder that changed the social care industry and to make the process fun and something that people actually look forward to.
16:01 I think one of our biggest mantras at Lottie is later life should be seen as that kind of next chapter for individuals.
16:08 It shouldn't be seen as that final chapter. And if we can bring that kind of positivity and kind of fun spin to what we're doing at Lottie,
16:16 I think that will change the way that people look at elderly people and also the way that people approach their later life as well.
16:22 We really want people living those final years rather than not.
16:26 Well, best of luck to you and your brother, Will. Thank you so much for being here.
16:29 Thank you so much for having me. It's been awesome to speak.
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