Otter Raises $23 Million To Tackle Broken Childcare Market And Help Stay-At-Home Parents Get Paid

Helen Mayer realized in May 2020 that her temporary stint as a stay-at-home pandemic parent was not as quick as she had thought. When her Boston-based startup Forward F1rst, a Boston-based tech company, collapsed in the same week as her 16-month-old boys’ daycare, Helen Mayer was forced to become a full-time caregiver. She almost immediately applied for a new job, believing, like many, that things will return to normal soon. Mayer tells Forbes, “I applied for a position in May but realized that I couldn’t accept it.” “At that moment, it was clear that it was going be a long journey.”

Mayer was not the only one who suffered from the pandemic. Mayer began to research parenting styles and trends in childcare as she saw other women posting about similar situations online. Mayer started facilitating pro bono childcare swaps by hand after posting a survey last July about possible solutions to some groups. She saw that stay-at-home parents enjoyed the work and decided to expand the system to allow these caregivers to be paid. Otter, which she launched last fall, has helped 7,000 families coordinate care and helped over 3,500 parents earn a combined $20 million. The startup just closed a second round of funding. It is now looking to expand.

New York-based Otter secured a $23 million Series A round from Sequoia Capital. Abstract Ventures, Thrive Capital, and others participated. Andreessen Horowitz, who led a $4.8 million seed fund last fall, also participated in the raise. Mayer said that the Capital would strengthen the company’s safety and trust team to overgrow. Mayer stated that Otter’s goal was to make sure Otter is a safe and reliable place for childcare. “We want to help people understand what is happening and to help them feel comfortable and confident.” Mayer has recently hired Steven Siger (ex-head of legal at Thumbtack) as COO and CLO. Dave Wilson was also one of the initial hires for Airbnb‘s trust & safety team.

The platform allows parents and potential caregivers to answer surveys about their parenting styles, approaches, and schedules. Before a caregiver is allowed to drop off, they go through extensive back-and-forths and background checks. Mayer said that the caregivers had received positive feedback from parents. They feel more connected to their children, and parents can get paid for their work. It is currently available in New York City and Chicago. There is a waiting list to sign up. Mayer hopes to expand the service to more cities in the near term.

The pandemic has brought childcare issues into the spotlight. However, many of these problems that working parents have had been there for years. Mayer joked that she knew all about them as kids and assumed they would be solved when she had her children. Jess Lee, a Sequoia partner, was the one who led Otter’s Series A. She is now joining the board. Lee says that Otter makes childcare more affordable, which she believes will make it a long-lasting solution. Otter can fill the gap between the hybrid schedules of the future and the many options such as daycare or hiring a nanny, provided parents can secure a spot. Lee believes Otter can make childcare more accessible and flexible. “There are places where there aren’t enough caregivers. This can be changed if you tap into the resources of stay-at-home parents already doing this work.

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Adam Collins
Adam writes about technology, business and economics. With master's degree in Economics, he's presented six papers in international conferences. As a solivagant in the constant state of fernweh, curiosity is the main weapon in his arsenal.

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