Orange-based startup grandPad Inc. has sold an equity stake to one of the largest PC makers in the world and signed a distribution deal with a nationwide provider of in-home senior healthcare potentially worth millions of dollars.
The maker of tablets geared for older people attracted $11 million in a preferred stock sale to a unit of Acer Inc. in Taiwan, which now controls nearly 49% of the company, according to a regulatory filing with the London Stock Exchange.
The investment provides growth capital and deep connections to Asia’s PC supply chain, according to co-founder Scott Lien.
“We have access to hardware design, manufacturing capabilities and worldwide distribution,” said the former Intuit executive, who launched the company about two years ago with his son Isaac, an undergraduate at Chapman University studying computer information systems. “There’s also an opportunity to work together strategically.”
Acer sold more than 19.6 million PC units last year, down 18.1% from 2014, according to Framingham, Mass.-based market tracker IDC. The decline was felt by every major PC maker last year besides Apple Inc., though Acer closed the year as the world’s fifth largest supplier, with a 7.1% market share, according to preliminary data.
Beijing-based Lenovo was No. 1 with 57.1 million units sold, down 3.6% from 2014, and a market share of 20.7%.
GrandPad will use the Acer proceeds in a sales and marketing push, adding to its employment count of 25.
“We’ve been in the market for over a year. Now it’s about scaling up on customer acquisitions,” said Lien, who wouldn’t disclose user numbers.
A recent distribution deal with Comfort Keepers should provide a boost.
The brand, operated by Dayton, Ohio-based CK Franchising Inc., this month began integrating the grandPad tablet into its core services for older people.
CK Franchising is a unit of French conglomerate Sodexo Group, a professional services provider with annual sales topping $28 billion. Its U.S. unit posts annual revenue of $9.2 billion.
GrandPad tablet users can view photos and videos on social media, play games, check the weather, listen to music, send voicemails, video chat, or make phone calls through voice activation or the touch of a button.
The device and service, which allows users to stay connected with family, friends and caregivers, costs about $60 per month, per user.
Comfort Keepers serves more than 30,000 customers through 700 franchise offices in the U.S.
“Over time it will be integrated over their whole program,” Lien said.
The deal’s recurring revenue model could provide tens of millions in sales for grandPad, which is targeting the fastest growing demographic in the U.S. and the world. Â
The U.S. is home to about 22 million potential users, and the global market tops 300 million, according to Lien.
“Most technology is designed for 30 year olds. It’s not designed for 90 year olds,” he said. “[GrandPad] can really transform their lives.”
The company is targeting the U.S. market, then moving into Canada, Ireland, France and several other countries.
GrandPad, which in January made its debut at CES, the world’s largest technology trade show, has raised $2.1 million, including a $1 million investment from Tech Coast Angels of Orange County.
