PHL Inno's weekly "Startup Spotlight" feature highlights founders and new businesses cropping up in the region.
The startup: Grapefruit Testing offers Covid-19 testing to school districts, summer camps, businesses and nonprofits.
Founded: February 2021
Home base: Philadelphia, with offices in Parsippany, New Jersey; Chicago; and Pleasanton, California.
Founders: CEO Christopher Gaeta; Chief Medical Officer Dr. Rick Pescatore; and Chief Product Officer Dr. Joseph Cesarine.
Grapefruit Testing isn’t the founders’ full-time jobs. Gaeta is an undergraduate economics student at Swarthmore College, concurrently studying neuroscience and medical ethics for a master’s degree at the University of Pennsylvania. He also works as an associate at New York-based venture capital firm VU Venture Partners. Pescatore is an attending physician with Einstein Healthcare Network, and Cesarine is an emergency medicine physician with Virtua Health.
The trio saw a “concerning lack” of proper resource allocation, Gaeta said, with large amounts of Covid-19 tests going unused and schools’ nursing and human resources departments overwhelmed by contact tracing duties. They began testing campers through the YMCA, with about 40,000 to 50,000 kids throughout the summer, and then scaled up Grapefruit to work with school districts and businesses.
The company name doesn’t stem from any particular love for the sour fruit, Gaeta said. The three founders were in the Fitler Club trying to come up with a moniker for the startup, and while lamenting about how some startups have bland names, Pescatore joked that they should name the company after the flavor of seltzer he was drinking: grapefruit. It stuck.
The product: Grapefruit Testing works with schools to offer rapid antigen testing, PCR testing and contact tracing services on a regular basis to keep students in class.
“I'm excited mostly for — I don't want to say post-Covid — but in several years from now, as we help reshape what it means to be sick when you're in school. So maybe mom and dad don't have to miss work to pick kids up,” Gaeta said.
Grapefruit also does responsive testing, for which it can quickly dispatch teams, in the case of an outbreak at a facility.
The startup has 115 full-time employees and about 400 doctors on staff, with the majority working in Greater Philadelphia. It also has operations in California, Michigan, New York and New Jersey, with laboratory partners in each of those locations.
Grapefruit Testing largely does not charge school districts for its services. Grapefruit Testing is paid by federal CARES Act and American Rescue Plan support — particularly the Elementary and Secondary School Emergency Relief Fund, which provided nearly $190 billion for assistance to school districts to respond to Covid-19 concerns and reopen.
Funding: Grapefruit Testing will begin to raise a $10 million to $20 million Series A round beginning in early 2022.
The startup has survived so far without venture capital and “several million dollars” in revenue, Gaeta said. It will use the Series A to fund sales and marketing operations and get in front of more schools when it comes to Covid-19 testing, he said.
Gaeta said they skipped a seed round because Grapefruit didn’t need the support in its early days.
“It's at a point, and as every company gets to a point, where we do not want to stagnate at the expense of not raising if we're really in a good spot, continuing to build and continuing to build that name,” he said.
The goal: Grapefruit Testing is looking to expand its reach into the “school wellness space” through telehealth in 2022. In the case of an outbreak, employees, students or workers can interface with a telehealth product to determine which kinds of tests they need, Gaeta said.
Gaeta is also looking to get the Philadelphia-area staff levels to 1,000 health care providers.
“My goal is to make every provider — this is not an exaggeration — in the Philadelphia [and] New Jersey area want to work with us because of the flexibility and consultation,” he said.
