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Homejoy says goodbye

blog.homejoy.com

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131–140 of 410 posts

Re: Homejoy says goodbye

#131

Post by erikb »

fraXis wrote: post #7

I used Homejoy and I liked it's ease of use. But after the cleaning lady they sent me was done, she offered me her direct phone # and told me I could contact her directly for any future cleaning needs. I always wondered how this business model was going to work if Homejoy's contractors could just give out their phone # at the end of their first service and the customer could just contact them directly for any future…

I think a real value is if you add many service types together in one platform and you can manage all of your household in one website/app. Then you can still get the cleaning lady's number, but you don't want to, because you have a much better overview when you can use the app for all the services you buy.

Re: Homejoy says goodbye

#132

Post by cjf4 »

This one's interesting to me, because it seems like they had done all the right things, had a real product, and worked really hard (I think I remember Graham saying she worked as a cleaner part time during YC).

Without knowing any of the specifics, this seems to be a good correction of a couple threads of thought. Most notably, startups are not a science, and not every business that is technologically lagging will be drastically changed by a modern tech platform.

It really comes down to value. Seems so simple but I think the startup community would do well to incorporate the importance of creating value in their pedagogy.

Re: Homejoy says goodbye

#133

Post by callmeed »

So Forbes named Homejoy one of the hottest startups of 2013 (and they make a 30 under 30 list). They raise money from top-tier VCs and angels. Adora does quite a bit of speaking (it seems) on growth, regional expansion, and startup inspiration. They expanded to 30+ markets.

But they were really just selling cleaning services for below cost–on the backs of 1099 workers. It's a worse model than Groupon and I can't fathom how the founders or investors thought it would work.

It all feels icky to me.

Re: Homejoy says goodbye

#134

Post by serve_yay »

kayoone wrote: post #51
tptacek wrote: post #16

I get the sense that many of the people involved in Homejoy are well-intentioned and hardworking. But I can't say that I think it's a bad thing that tech startups are finding it difficult to monetize unskilled labor. The technology that most companies like these offer (with the possible exception of Uber) is a commodity. The real asset they have is the network effect. Which makes the balance of power between the tech…

What does Apple or steam offer developers for their 30% cut ? customers and ultimately revenue to sustain themselves. An open marketplace has incredible value if its popular. Tech is the easy part of most startups.

... Apple builds the platform their apps run on. HomeJoy doesn't build houses, or manufacture sponges.

Re: Homejoy says goodbye

#135

Post by bishnu »

jjarmoc wrote: post #34

When I hear about companies like this going under, I always think how odd it is that I've never previously heard about them. Then I realize, that may have been part of the problem.

This is surprising to me. I'm INUNDATED with Homejoy ads all over the internet. I've never used them (which also might have been part of their problem). Perhaps you just live somewhere they don't provide service to yet? :)

Re: Homejoy says goodbye

#136

Post by gsharma »

I never used Homejoy, as they were pretty pricey. I have cleaners charging me 1/3 of what Homejoy quoted.

That being said, I talked to several (10-15) people who used Homejoy at least once. The responses I got from most of those people was that the cleaners weren't professional. In fact several of them mentioned that cleaners didn't know what Homejoy was. They were sent for cleaning by their contractors. In other terms, the cohort I talked to had a really low NPS for Homejoy.

I think Homejoy wasn't able to nail down that user experience of their real product (i.e. Cleaning) no matter how amazing their on-boarding/booking experience was.

It must be very disheartening for the founders and the team. All the best to the their next adventures!

Re: Homejoy says goodbye

#137

Post by osi »

enjo wrote: post #114
sp_ wrote: post #89

Earlier quoted context omitted.

I've had the exact same experience with Vint ( https://www.joinvint.com/ ) - Go through personal trainers until you find one you like and then move off the app. The hourly cost will be lower but the personal trainer will still make more money. I've also had Uber Black drivers give me their personal limo service business cards. The difference is that a cab is a commodity while a personal trainer is something that need…

It's not just that rides are a commodity, they also have an immediacy effect. I don't care who drives me, but I care that they pick me up in the next 3 or 4 minutes. When an uber driver gives me a card that's great, but it's kind of worthless because they're unlikely to be nearby. Hell in the time it takes me to call them I can likely have another car at my front door if I just use the app.

Depends. I like being able to schedule rides to the airport in advance, so I know exactly when I'm going to be picked up. And the rate will be pre-determined.

Re: Homejoy says goodbye

#138

Post by birken »

At the end of the day, this is a lesson in unit economics. If you want to make a successful startup, your unit of sale better be super profitable.

Most successful technology companies sell bits, with high fixed costs but very small marginal costs. This means if you grow really big, your fixed cost growth will eventually flatten out but your profit can continue to grow. Facebook, Google, AirBnb, Uber.

If you are selling something in the real world, especially if you are owning the whole process, then your marginal costs are going to be pretty high, which means your profit margin is going to be lower. This is completely fine and a ton of businesses run like this, but these businesses have to be very careful with their fixed costs. You can't grow like your average tech startup because this model is different than most tech startups.

The exact reason they are going out of business is less important than the fact that a business with high marginal costs is very fragile. A slight increase in a high marginal cost can destroy your profit margin, whereas if your marginal cost is extremely low then you are much more resilient.

High fixed costs + low marginal cost = Good

High fixed costs + high marginal cost = Be careful

Re: Homejoy says goodbye

#140

Post by frandroid »

seizethecheese wrote: post #116
dkasper wrote: post #94

Earlier quoted context omitted.

You think cleaning is skilled labor and driving isn't? Uber drivers better not be unskilled. You're putting your life in someone's hands every time you ride in an Uber (as with any car). There's almost no skill to scrubbing toilets and vacuuming rugs, and if you mess it up you get fired but no one dies. The only skill required is attention to detail and caring enough to do a good job.

I can't argue that driving is unskilled, but cleaning is certainly a skill. I've gone through several services for house cleaning in the last few years and the quality of service varies dramatically. > The only skill required is attention to detail and caring enough to do a good job. Thought experiment: imagine yourself cleaning 100 houses professionally for two hours. My bet is that the last house would be 2X - 3X m…

There is no house-cleaning college. This is what "skilled labour" refers to. Driving and house-cleaning is not skilled labour.
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