By Thomas A. Parmalee
If you’re trying to grasp the significance of Foundation Partners Group’s acquisition of Cake, it’s helpful to understand what it’s buying.
Lee Senderov, chief marketing and digital officer at FPG, explained it like this: “It’s kind of like the Expedia for all things end of life.”
Cake drives its top line “by promoting our affiliate partners who offer services and products that our users will appreciate, and by working with enterprise partners to create versions of Cake configured especially for their needs,” according to its website. “We make money by promoting our affiliate partners who offer services and products that our users will appreciate, and by working with enterprise partners to create versions of Cake configured especially for their needs.”
Partners include AARP, which is an investor in Cake; Better Place Forests; and Trusted Will. “As the largest direct-to-consumer channel for end-of-life planning and bereavement support, Cake has been approached multiple times throughout the years for acquisition.” Senderov said. “As a strategic investor, Foundation Partners has been observing Cake for years. The timing was right to join forces to deliver a better omnichannel experience for families.”
While FPG does not foresee dramatic changes to the Cake business model – at least not initially – it does have a slew of ideas on leveraging the Cake platform to drive preneed leads, Senderov said.
“A lot of our ideas are in their infancy,” Senderov said. “We are assessing different options for how to best use and leverage the Cake assets – as well as figuring out how to best combine those assets with our funeral homes.”
The company is also “assessing how much of the current model we will be keeping versus what we should change,” she said.
Terms of the acquisition were not disclosed and FPG declined to reveal details on whether Cake is profitable. But Senderov noted that Cake has made “some really great strides in thinking how to monetize the space.”
Cake is about 10 years old, and during that time, more than 100 million consumers have visited the website, Senderov said. “It continues to run at the multi-million visitor level year over year, and it continues to grow organically,” she said. “That really speaks to the need for this kind of information.”
The co-founder of Cake, Suelin Chen, Ph.D., did a tremendous job turning Cake into a trusted destination for families to get neutral information about the end-of-life space, Senderov said. Chen will be staying on as an adviser for at least the next six months, Senderov said.
Coincidentally, both Chen and Senderov live in the Boston area. Cake had six full-time employees when it was acquired, some of whom will be staying on with FPG. Everyone worked on a virtual basis, so there is no office space to determine what to do with, she said.
As to why the company is named “Cake,” its website admits the word may not be the first to come to mind when it comes to end-of-life planning. “But we chose it because it’s a warm, inviting symbol of celebrating and honoring life,” its website states. “Proactive planning is a considerate and generous act that honors our lives and the lives of those we love. Planning also encourages us to reflect on our final wishes, which can help us live more purposefully and meaningfully in the present. When we think deeply about what’s most important at the end of life, we understand what’s most important now, and can better appreciate our relationships, celebrate accomplishments, and realize our goals in the precious time we are given.”
A Robust Library and Additional Resources
The Cake acquisition comes with a library of articles related to end-of-life across numerous categories, Senderov said.
“They have met a consumer demand,” Senderov said. “As we think about innovation, that is what drew us to the partnership with Cake: Their ability to think about what is missing in the market, and how do we fill that need?”
Senderov, who sits on the board of Newton-Wellesley Hospital, which has locations throughout the Boston area, where she’s a member of its Palliative Care Committee, noted that when she was getting up to speed on materials that were provided to nurses interacting with families with loved ones in palliative care, she was given a packet of articles. It was filled with information from Cake.
“They have such great content that is so informative to families,” she said.
“That is how I think of leveraging Cake’s content,” Senderov said. “How can we use the content it has collected from so many experts in the field – around 6,000 articles related to end of life?”
Cake has already experimented with different subscription models, Senderov said, adding that for the most part, consumers don’t want to pay a monthly or annual fee to belong to something Instead, they want to pay once.
“Subscription models in this space are very different … people don’t want to think about when is going to be the end,” she said.
Cake has multiple tools that focus on different aspects of the user journey. “One hundred thousand people have signed up to access the end-of-life planning tool, the post-loss checklist, and more,” Senderov said. “Some of them also pay to access more services, like one-on-one consultations.”
Cake also offers free online tributes for loved ones, which has been the subject of much discussion at FPG as it ponders how that component may mesh with its funeral homes.
“What is best for families?” Senderov asked. “We obviously have an obituary product that we provide to our families through our funeral homes, but what about families that don’t necessarily use a funeral home? Maybe they used us for a direct cremation, and they are having a celebration of life at Mom’s favorite restaurant. So, where should they memorialize – somewhere on Cake or somewhere else in our ecosystem?”
In addition to its library, Cake visitors can access resources related to estate planning and estate settlement as well as advance directive forms by state, a funeral home directory, information on pet loss, genealogy tools, grief resources and more.
Preneed
The most obvious question when it comes to FGP’s acquisition of Cake is how it may play into its preneed efforts, as well as its potential to turbocharge the efforts of others engaged in preneed – even companies that may at first glance seem to be competitors to FPG.
As of now, Cake does not have any existing relationships with preneed insurance companies “in the traditional sense,” Senderov said.
“But I think a lot of folks who come to the Cake website have an interest in preneed,” Senderov said. “They just come in at different parts of the funnel … some may have an initial interest while others may need to be taught it exists. Others are very far down the journey and are ready to transact.”
When a website is attracting millions of visitors per year, by definition, there will be people in a variety of places in the funnel, she said.
That works out great for FPG, however, as it has invested heavily in understanding what consumers want and need wherever they are in the preneed funnel. FPG stands ready to leverage its expertise in converting families who may be interested in preplanning into families that actually plan, Senderov said. “There are a lot of synergies there,” she said.
There is also the potential for FPG to leverage Cake to drive preneed at other firms as it does not have a presence everywhere.
FPG has always made it a point to establish a footprint and grow in high cremation markets (its companywide cremation rate is over 85%), and it will continue to focus on those areas, Senderov said. “We have built our entire business model on the cremation-heavy market,” she said, pointing out there are still parts of the country where cremation is lagging.
“There are states that we don’t operate in, and quite frankly may never do so,” she said, providing Montana as an example. “That is not a state of interest to us.”
However, FPG is certainly open to thinking how it may leverage the Cake platform to help families who want to prearrange with a non-FPG firm in such states, promoting the value of funeral service while earning some money for itself as a lead generator along the way.
It may even be willing to do the same in markets where it has a presence, Senderov suggested. “If we don’t have a premier brand in a certain market, is there an opportunity to partner?” she said. It’s something FPG will need to work through, but it’s a question that’s worth asking.
Regardless of the company’s ultimate answer, FPG is committed to providing consumers with the best experience possible, Senderov said. “It does not behoove me to turn someone away who is not in one of our markets,” she said. “It is better to say, ‘Here is this great firm – go work with them.’”
Asked who she considers Cake’s biggest competitors, Senderov noted that it’s a “highly fragmented” space with a number of players – and no one who stands heads and shoulders above the rest.
For instance, Dignity Memorial has a robust website with resources, but it’s not a neutral party. Legacy.com provides the public with rich information related to life stories, but that’s only one component of end-of-life planning. “The beauty of Cake is that it coalesces all this information into one resource,” Senderov said.
The acquisition, Senderov said, is the first of its kind and shows that FPG is “doubling down” on its investment in digital tools for funeral directors and families to drive prearrangements, at-need services and more.
Follow FuneralVision.com on LinkedIn.
Follow FuneralVision.com on Twitter.
Follow FuneralVision.com on Facebook.
