Cleaning Startup Handy Finds Climbing Profitability Mountain Steep!
The founders of the new on demand cleaning startup dubbed Handy have found climbing the mountain from no profit to profitability to be a daunting but not impossible challenge. For many new startups such as this one, some pressure is relieved off such steep expectations by investors and shareholders is by raising VC capital and looking for buy-in from angel investors.
Handy so far has raised over $110 million dollars in venture funding to help keep its hopes and dreams alive for the future. In the first two years the market for on-demand cleaning services seemed like an open and untapped market for growth and success. However challenges would remain as one of Handy’s chief competitors, Homejoy, went out of business in July 2015. The company gleaned lessons from this failure and began cutting human staff in favor of software based hatboxes to help trim their operating costs down. During this time, they were still not churning in big profits yet.
The one decision that has helped Handy’s explosive growth has been to not expand beyond the 28 markets they were already servicing. This allowed for the company to concentrate all of their efforts in those cities and customer acquisition and retention rates went up steadily since this change was implemented. One thing is for sure Handy.com is now carefully analyzing using its capital to further its growth margin by doing a few things well versus trying to be all things to all people and markets. 50 percent of its growth is organic and through referral channels now and the company is beginning to slow down on using as much capital as it has in the past. Handy remains optimistic about its future and hopes that any future investment injections will be considered from a positive financial picture and not from the halls of an impending tech bubble or company implosion. Visit https://www.handy.com/services for more info.