Why Homejoy Failed
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Why Homejoy Failed
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Re: Why Homejoy Failed
#2"The steady leak of its best workers to direct employment arrangements with its own (now former) clients."
This is a huge hurdle in any direct services market. While you're not likely to hire your own private driver and thus end your working relationship with Uber, you're probably very likely to find a cleaner that you like a lot and who does a great job cleaning your house and go on to form an exclusive working relationship with them instead of continuing to use a service that sends you random cleaners from a wider pool. Same with services of the same type- babysitters, dog walkers, etc.
Re: Why Homejoy Failed
#3I read a comment on HN a while ago that went along the lines of "there is a new breed of startups that's in the business of selling dollar bills for 95 cents". I really like that formulation. Your job gets a lot easier as soon as you provide more value than you charge for it. Seems like that was one of the big problems with Homejoy: they were not able to charge more. The reality is that home cleaning is very price competitive. Anyone with a mop and a bucket can undercut your price, and as long as the customer trusts them and likes them they have no reason to switch. For example I know of a 12 year old kid who decided to start his own cleaning business. He calls it "a boy and a bucket", and from what I am told does a fantastic job. He also charges about 1/2 of the market rate around where I live, yet provides a superb service.
Re: Why Homejoy Failed
#4After reading this, I'm left to ponder why anyone would think this was a potential "unicorn" business where it made sense to take big losses to grow revenue. After all, as the article notes, cleaning services like Merry Maids are a well-established thing. (As are personal references for housecleaners.) That doesn't make a potential new entrant bringing a better UX to the process a stupid idea. But it would seem to limit the potential opportunity.
Re: Why Homejoy Failed
#5The difference with Uber is that it requires a lot more trust to give someone access to your home while you're away to clean it. Not sure I would want to subscribe to a service where I would have to trust any local dude to visit my home. It's like a nanny. Picking someone to look after your kid is a very personal thing. It's not a lowest bidder thing.
Re: Why Homejoy Failed
#6"The steady leak of its best workers to direct employment arrangements with its own (now former) clients." This is a huge hurdle in any direct services market. While you're not likely to hire your own private driver and thus end your working relationship with Uber, you're probably very likely to find a cleaner that you like a lot and who does a great job cleaning your house and go on to form an exclusive working rela…
I actually did this once with Move.com. I have moved a lot over the past decade and used them pretty extensively to hire movers. Since two consecutive moves were local and I told the movers that during the first one, they told me to contact them directly for the second one. I got a discount, they got to keep more of the money.
Re: Why Homejoy Failed
#7>Adora Cheung opted to sit among employees, rather than in a swanky corner office.
It's a pretty sad state when it's considered admirable and rare that the CEO of a company that is spending other people's money, and making none, doesn't have a "swanky" corner office.
Re: Why Homejoy Failed
#8The difference with Uber is that it requires a lot more trust to give someone access to your home while you're away to clean it. Not sure I would want to subscribe to a service where I would have to trust any local dude to visit my home. It's like a nanny. Picking someone to look after your kid is a very personal thing. It's not a lowest bidder thing.
Getting in a car is pretty much the most dangerous thing a person does in an average day. You may be trusting a cleaner with you possessions, but you're trusting that Uber driver with your life.
Re: Why Homejoy Failed
#9"The steady leak of its best workers to direct employment arrangements with its own (now former) clients." This is a huge hurdle in any direct services market. While you're not likely to hire your own private driver and thus end your working relationship with Uber, you're probably very likely to find a cleaner that you like a lot and who does a great job cleaning your house and go on to form an exclusive working rela…
I've done this several times with TaskRabbit and i'm actually surprised the same thing hasn't happened to them.
Re: Why Homejoy Failed
#10I read a comment on HN a while ago that went along the lines of "there is a new breed of startups that's in the business of selling dollar bills for 95 cents". I really like that formulation. Your job gets a lot easier as soon as you provide more value than you charge for it. Seems like that was one of the big problems with Homejoy: they were not able to charge more. The reality is that home cleaning is very price co…
IMO, that's the late 90s bubble all over again.
I know... we're not in a bubble now... but losing money and making it up on volume was the big joke back then, iirc.