Silicon Valley, one might argue, seems to grow increasingly out of touch as technology progresses. Innovations such as a $400 juicer--or a vending machine in-lieu-of bodega--target only an elite sliver of the U.S. customer base, while the most pressing issues of the day are left untouched.
That's why Ankur Jain, the co-founder and chairman of the global startup network Kairos, is offering a $25 million incentive to businesses tackling issues such as the student loan crisis or the rising cost of healthcare.
"If there's one thing we in the tech world should have learned from this recent election, it's that the middle class is being squeezed," noted Jain, writing in an op-ed published Thursday on Medium. "While [Silicon Valley] obsesses over cryptocurrency, the financial burdens our communities face at each life-stage are only getting worse."
Current data certainly reflects that point. At present, the median income in the U.S. is only $59,039, according to the U.S. Census Bureau, while the cost associated with things like housing and child rearing are on the incline. (Consider that the cost for a middle-income family to raise a child born in 2015 to age 17 jumped to more than $233,000--a three percent increase from the previous year, according to a report from the U.S. Department of Agriculture.)
In that light, the luxury of participating in an "initial coin offering," for example, or shelling out $100 for one of Arianna Huffingotn's iPhone beds seems ridiculous.
"It really hit a peak this year," Jain said in a conversation with Inc. this week. "The stuff people are building is so out of touch with what the rest of the world is dealing with that it's become a real problem."
Yet, just as technology is partially responsible for socio-economic issues--i.e., the rising cost of living in tech hubs such as Seattle and San Francisco, or the automation of factory jobs that have left hundreds of thousands of workers unemployed--so too is tech responsible for fixing them, he insists. Over the next several months, the Philadelphia-based Kairos intends to make investments of between $250,000 and $1 million in about 30 different businesses, while also offering operational support.
Kairos, which has more than 1,000 members under the age of 26, counts high-profile alumni including Casper CEO Neil Parikh. In addition to mentorship and networking, Kairos members are invited to a multi-day summit co-hosted by the Rockefeller family. The society was co-founded in 2008 by Jain, 27, son of the serial entrepreneur and Moon Express chairman Naveen Jain.
One example of a company that will get some funding is Cera. Based in London, the startup connects families with on-demand home care specialists. As the cost of palliative care increases-- in fact, one out of every four Medicare dollars, or more than $125 billion, is spent on services for beneficiaries in the last year of life-- the business claims to be a more inexpensive, personalized solution for families. Cera charges 20 pounds per hour in the U.K. ($26 USD,) and says it pays its specialist an above-average salary.
Little Spoon will be another Kairos fund recipient. The San Francisco subscription food service delivers organic and plant-based baby foods, tailored to a child's nutritional needs. Launched by Tinder co-founder Sean Rad and Chobani executive Kyle O'Brien, Little Spoon charges just $2.99 for two weeks worth of 4 ounce-sized meals, or up to $4.99 for individual meals. "The cost of childcare is skyrocketing," says Jain. "There are a few elements that matter most, like making sure your child has access to quality food."
Of course, it's not entirely clear that these portfolio companies--however well-intentioned--will be successful enough to have an impact on the issues they're trying to solve. Certainly the food delivery business has proved too expensive to justify to some investors, as the recent shuttering of companies including Maple and Sprig has proven. Meanwhile, even Jain concedes that there are some problems that entrepreneurs shouldn't take it upon themselves to solve.
Still, Jain will be happy if the fund is successful in re-orienting the Valley's focus on the most pressing problems for average Americans. "We lost touch with everyday people," he says. "We need to re-focus."