Rachel and I had breakfast at Berners Tavern - one of my favourite morning havens. Rachel was the former CEO of the world’s largest online doctor service, which grew to 1.3m paying users in the UK, Ireland and Australia under her leadership. But after having her daughter and hearing friends’ horror stories finding childcare, she was inspired to quit her job in 2016 and she founded Koru Kids, the UK’s first managed nanny share network. We discuss her recent seed funding round, how to be different types of CEO and the merits and drawbacks of corporates and startups.
Current Job CEO of Koru Kids
First Job Babysitting…but my first proper job was working in an aluminium smelter when I was 18
Education Undergrad in Linguistics and Politics from Otago University, New Zealand; Masters and Doctorate in International Development from Oxford
Go to meeting spot I meet everyone in the Café Rouge in Euston station piazza. Not because it’s brilliant but because it’s easy for everyone to get to Euston and it’s 5 minutes from my co-working space
Favourite book Never Let Me Go, by Kazuo Ishiguro
Necessary extravagance HelloFresh, the meal ingredients delivery service. We were very early customers – we’ve been using them for 3 years now
Favourite productivity tool Front, which is our customer services software. It’s hard to make customer services software joyful but they managed it
Top networking tip Always get ‘warm intros’ from a mutual friend wherever you possibly can, rather than approaching people cold. Busy people use warm intros as a way to figure out who to meet (and if you’re a true entrepreneur you’ll figure out how to get one)
Hottest tech startup in the UK right now I’m so excited about Entrepreneur First and the high tech startups they continue to produce like clockwork. I’ve been involved with EF since their beginnings 5 years ago. Their demo days have always been good but lately they are off the charts. If you want to see the future of UK tech, get a seat at one somehow
Tell us about your career prior to founding Koru Kids and your biggest take aways from those experiences?
I was at McKinsey for 6 years, working on all sorts of things. It taught me to run teams and projects, and to figure out company strategy. I then moved to the NHS for 15 months, where I ran the Strategy team for London. It taught me how to think about influencing within systems. Finally I was CEO of DrThom.com, the world’s largest online doctor service, for 3.5 years. This taught me how to recruit, lead, run operations, and a lot about digital.
What is Koru Kids & what was the motivation behind it?
When I was at DrThom.com, I had my daughter. Purely by luck, we happened to find an absolutely amazing childminder who lived near us. She looks after a few kids together at the same time, and my daughter adores it. Growing up with other children has been amazing for her social development, and her language. So my daughter has always had phenomenal childcare. But I saw that my friends who also had kids the same age really struggled to get their childcare sorted out. It’s so expensive – a full time nanny costs £37K on average in London – and if you go the nursery route, it’s very hard to keep going with a big career as you have to be there every day at 6pm for pickup (very tough to achieve) and if they’re off sick, which kids are a lot, you have to stay home with them. There aren’t nearly enough great childminders like my one – in fact there are 10,000 fewer childminders in the UK than there were in 2011. I saw friends quitting jobs they loved just because they couldn’t sort out their childcare. So I decided to found a company to help more families access the kind of childcare I’d been lucky enough to find by chance.
What’s the single best piece of business advice that helped shape who you are as an entrepreneur today?
I love Steve Blank’s definition of a startup:
“an organisation built to search for a repeatable and scalable business model.”
Focus on this and your job becomes obvious: it’s all about learning. It’s okay that you don’t have a business model finalised yet. Of course you don’t! You’re a startup. But the faster you learn, the faster you find your business. So do anything that accelerates learning. That means creating a culture where people are honest about mistakes, not afraid of trying things, and disciplined about reviewing the results of experiments. If you focus on this, everything else follows. I repeat this like a mantra to my team.
What has been the evolution and milestones to date of Koru Kids?
It took a while to figure out the specifics of our first service, which is helping parents share their nannies. We help parents who are employing a nanny already, find another family to share the nanny with. This is amazing for the kids, who get a friend who is a bit like a sibling. It also allows both families to save about 1/3rd on the cost of their nanny.
The first nanny share match we made was an amazing milestone. We introduced two people who lived about 5 minutes walk from each other, and they’re all so happy with their nanny share. The nanny loves the kids, and is earning far more money; the parents are saving a ton on their nanny and the kids are totally adorable together. It was the perfect first match for our business.
Finally we just closed our seed round, which feels like a great milestone! We raised £600,000 in seed funding from some of the UK’s top investors, including Michael Pennington, founder of Gumtree; the two founders of Europe’s top accelerator Entrepreneur First and Rocket Internet’s Venture Capital arm, Global Founders Capital (GFC).
Have you changed as a CEO from DrThom to Koru Kids?
At DrThom I had a team of about 40 people, and I could think ‘big thoughts’ and then rely on the specialists to actually put it into practice. At Koru Kids we started with no specialists… so I had to do everything myself initially, and learn an awful lot of detail very quickly.
What metrics do you focus on?
Our top priority is making really great nanny shares. So key metrics for us are: number of families in our network available for match; number of shares; and duration of shares. We don’t just take an introduction fee and then never see our customers again - we offer lots of support to families as their share proceeds. It’s hard to communicate this value ahead of time, but in practice there are always changes and questions that arise. We want to be there for the journey.
Biggest challenge so far?
Being a non-technical founder and needing to hire tech talent. Luckily, I have some amazing technical advisors who have helped a lot.
What is your long term vision for Koru Kids?
We are building the world’s best childcare service, bar none. We’ll offer sick cover, holiday cover, and training for nannies. It’ll be affordable, reliable, and easy for parents to arrange.
Women in Tech
Tell us about your fundraising experiences and advice for others looking to raise capital.
My track record at DrThom.com was very important in my ability to raise capital. At seed stage you’re really just investing in a founding team, not really the idea itself – you’re making a bet that the founders will be able to discover a business. Luckily I had a lot of great people who thought I could probably do this. That’s not to say it was all plain sailing - the legal processes were interminable! But I’ve ended up with a cadre of investors I’m incredibly excited about. Over half are former founders, over half are highly experienced VCs or angels, several are both of these things, and none is neither.
Will you think about building a diverse team and what can we do better to attract and retain more women in those teams?
One of the things I really want to do with Koru Kids is figure out how to tap into the pool of women who are highly qualified and want a job that works within the school run. It’s criminal how much professional talent is wasted because there aren’t enough jobs like this. I know so many amazing, smart, highly-educated and experienced women who want to work 9-3pm but can’t because jobs don’t do that. I don’t see why not, and I really want to figure out how to provide these job opportunities within Koru Kids. The balance we need to find is that, especially in the early days of a business, it’s also really important to be all in the same room. But I think we’ll get there.
What personal qualities to you attribute most to your success?
A certain doggedness. My chief quality is persistence. If I don’t know it, I’ll learn it. If I can’t do it, I’ll try 100 different ways. I think the answer to most things is out there, you just have to read the right blog or book or ask the right question to the right person. Mostly what I do is just extract information and combine it in new ways, then just keep doing that again and again and again and again until something works.
You have experienced both big corporates and startups - what advice would you give to new graduates?
It’s very useful to experience both. Consulting is helpful as you learn so very quickly when you’re exposed to lots of different types of organisation within a short space of time. Big corporates teach you lots of things ‘not to do’ which you can then avoid building into your startup.
I’ve never planned my own career, it’s just happened. I would say to a new graduate, just take opportunities which look interesting and like you’ll probably learn a lot. If it doesn’t work out, no big deal. Oh, and work really hard in your 20s – you’ll be glad you did when you have kids.