Last month, the California Public Utilities Commission (CPUC) unanimously approved new regulations condoning ride-sharing services like Lyft and Sidecar. But the new legal framework could also breathe new life into lesser-known companies such a SilverRide, a six-year-old company whose name may be its biggest liability.
At first glance, SilverRide sounds like an Uber for seniors, but its focus actually extends well beyond transporting the elderly. “Transportation is 20 percent of what we do,” says founder Jeff Maltz over coffee near SilverRide’s San Francisco offices. The company’s primary focus is “championing socialization for seniors.”
It’s a big market. The senior population is growing steadily. By 2030, roughly 20 percent of Americans will be 65 years or older, up from 12.5 percent today.
More important, scientists are increasingly discovering how important socialization is for the elderly. Just last month, University of Missouri researchers published findings around what happens when seniors stop driving. Among their conclusions was that seniors’ health and happiness meaningfully declined. Social connectedness also helps the immune system to work better, lowers stress hormones, and can delay memory loss, according to the Harvard School of Public Health.
SilverRide offers seniors the chance to get outside the home and interact with others. For $85 an hour, the company’s drivers will escort the elderly to shop at the grocery store, to see a movie, or to pick up grandchildren for an ice cream outing, among other things. (Seventy percent of the time, drivers join riders in their activities.) In its six-year history, it has orchestrated 150,000 rides for more than 3,500 clients.
The question is whether SilverRide – which is looking to raise $3 million to expand nationally – is a big business.
From all outward appearances, the numbers sound good.
According to Maltz, SilverRide is profitable. Currently, the company pays $1000 to acquire a customer, and customers pay $450 a month on average for 24 months.
SilverRide’s expenses also just went down significantly. Up until now, SilverRide has used its own fleet of cars. (The company has a staff of 22 full and part-time employees to pick up seniors and take them out.) But the most recent CPUC regulations change all that. Now, SilverRide’s employees can use their own, commercially insured cars, vastly expanding the potential size of the company’s transportation fleet.
The biggest impediment to SilverRide’s growth may be convincing seniors to pay for something as intangible as an experience. SilverRide is a fairly expensive service, and there may not be a large population of elderly people who understand the service or can justify spending $450 a month on their social lives. (One-third of SilverRides’ customers call the company themselves. The other two thirds of its customers come by way of their children or other senior caregivers.) In fact, Maltz says his biggest competition is a customer’s friends and family.
SilverRide could benefit from the marketing leverage and distribution that a larger health care partner could provide. Maltz says that the company has attracted the attention of “several large health care companies” that are “engaging in pilots” with SilverRide, but he declines to be more specific.
In the meantime, VC-league help with advertising, as well as to build up an executive team, would also go a long way, suggests Maltz. “We have 400 people around the country interested in opening up regional SilverRides,” he says. “This company is ready to blast off and get out there.”
Sign up for our morning missive, StrictlyVC, featuring all the venture-related news you need to start you day.