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Homejoy says goodbye

blog.homejoy.com

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Re: Homejoy says goodbye

#191

Post by mycroft-holmes »

seizethecheese wrote: post #95
brianmcconnell wrote: post #71

Earlier quoted context omitted.

A prediction about "sharing economy" companies. Almost all of them are tacking on a thin rind of web/mobile UI and smart dispatch technology to an existing service. The long-term winners will be companies like Flywheel that recognize this and focus on providing that service to existing operators, much like payment processors. This, of course, is perceived as a smaller market since they can't count revenue the same wa…

Absolutely, however another "advantage" of many "sharing economy" companies is that they skirt regulations that incumbents must adhere to.

The real question to ask in this case is whether those regulations should be there in the first place.

Re: Homejoy says goodbye

#192

Post by handy_nyc »

I can very confidently say that Handy is headed in the same direction Homejoy. Handy is facing a myriad of class action suits in Boston and is facing a number of legal battles with exempt and non-exempt employee suits. I've seen the cash burn in the space and it is very unfortunate senior leadership doesn't pay attention to it. It's all about making it look like hockey stick growth to investors. The cleaning professionals working on the platform are all very unhappy too.

Re: Homejoy says goodbye

#193

Post by mbesto »

As tptacek said, I'm sure many of the people who created and work for these businesses are well intended and hard working, and we have to applaud them for that.

However, the writing is on the wall for any "sharing economy" service that is simply a technology wrapper for non-SSN'd workers in the US. A couple of challenges that aren't solved by technology:

1. Many unskilled labor positions, especially those that incorporate illegal immigrants, are paid in cash.

2. The price points are absurdly low to create any sort of margin to sustain a business (I can only assume most of these companies are doing 3. Response of workers turns sour when they realize the system inevitably becomes indentured servitude.

4. "Rigorous background checks" - I have yet to see how technology has made background checks any more "rigorous" or how this has allowed companies to scale the quality of workers.

5. Scaling quality - many of these services (moreso for services like Thumbtack) start by hiring skilled people (usually MBA students, aspiring actors, etc) who are looking to earn a few extra bucks for fairly unskilled activities. People enjoy the service since they not only get a higher quality service but also because "it comes with a smile". There is only a limited pool of these type of workers, which inevitably means the supply side of the business gets eliminated at a certain scale.

I think there might be a place for these type of businesses, but perhaps not in the venture world.

Re: Homejoy says goodbye

#194

Post by onewaystreet »

Retric wrote: post #177
austenallred wrote: post #143

Earlier quoted context omitted.

> The long-term winners will be companies like Flywheel that recognize this and focus on providing that service to existing operators, much like payment processors. I don't think this creates a very big moat - that's essentially what Uber started out as (dispatch for private driving companies that already existed); they started letting anyone drive in order to meet demand. If all the services are interchangable (and…

Defaults can change really quickly. Unlike Facebook Uber has basically zero network effect between cities. So, a competitor can win one or two small cities and just keep growing. Consider there are only 40,000 taxi drivers in New York. All it takes is for a company to find the top 5-50% of Uber/Lift drivers in a city offer them a minimum income of a few k/month assuming they take A% of rides and work y hours and boom…

If Uber "pops" it will be because the ride sharing industry died. There is no scenario where Uber becomes MySpace to a competitor.

Re: Homejoy says goodbye

#195

Post by 7Figures2Commas »

ChuckMcM wrote: post #181

And the recode story ( http://recode.net/2015/07/17/cleaning-services-startup-homej... ) which has a bit more clarity. Trying to fund raise a sharing economy business just after Uber gets a bad court decision on the employee/contractor question is hard. It is almost like having your company go back to being a 'seed round' level risk for some investors. It also lends credibility to the 'not a bubble' discussions if st…

> It also lends credibility to the 'not a bubble' discussions if stage C investors are showing restraint but that is a different discussion.

Yes, It's Not a Bubble(TM) if companies with significant and obvious legal risk are only raising $30+ million Series Bs but not $100+ million Series Cs.

Oh wait[1][2].

Employment class action attorneys couldn't have designed companies more vulnerable to lawsuits if they tried. Some of these VCs should have just written checks directly to the class action attorneys.

[1] http://www.businessinsider.com/instacart-raised-220-million-...

[2] http://time.com/3748438/instacart-lawsuit/

Re: Homejoy says goodbye

#196

Post by brazzledazzle »

pnathan wrote: post #124
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…

> the balance of power between the tech company and the "1099 contractors" That hits the nail on the head. A 1099 contractor has to cut some 30%-40% off their wage to support things like self-insurance, etc (or add yea much). If you're "working" for a gig provider, you're not a 1099 employee by the inherent nature of the thing. Granted, you're not in a normal employer-employee relationship, but neither are you a skil…

It seems like you're a 1099 as soon as you give a client your phone number to cut out HomeJoy. The law might not agree, but it certainly seems well within the spirit. Seems very common too (at least based on the HN comments).

Re: Homejoy says goodbye

#197

Post by austenallred »

mycroft-holmes wrote: post #191
seizethecheese wrote: post #95

Earlier quoted context omitted.

Absolutely, however another "advantage" of many "sharing economy" companies is that they skirt regulations that incumbents must adhere to.

The real question to ask in this case is whether those regulations should be there in the first place.

Disregarding the competitive aspect, it's absurd to me that people praise banning Uber and Tesla for the "consumer safety" of taxis and car dealerships.

Re: Homejoy says goodbye

#198

Post by superuser2 »

brianmcconnell wrote: post #71
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…

A prediction about "sharing economy" companies. Almost all of them are tacking on a thin rind of web/mobile UI and smart dispatch technology to an existing service. The long-term winners will be companies like Flywheel that recognize this and focus on providing that service to existing operators, much like payment processors. This, of course, is perceived as a smaller market since they can't count revenue the same wa…

There is a great deal of schlep involved in generating supply and demand, and more importantly developing good technical controls to promote quality and reduce fraud, and the human support to handle the disputes and quality issues that slip through the cracks. There is nothing thin about the layer. Interchangeable maybe, but Uber et al are not going to be replaced by pure software anytime soon.

Re: Homejoy says goodbye

#199

Post by brazzledazzle »

storgendibal wrote: post #88

Higher prices, questionable convenience, and poorer service. The quality of the cleaning had deteriorated over time and the price was higher than independent cleaners I later found through personal referrals. I had 4 different Homejoy cleaners. The very first one was awesome and I thought, "Wow, this is great". Then every single cleaner after that was terrible. Two of them started wet mopping before vacuuming or usin…

>she got angry and refused to work until I went into another room.

I would have kicked her out. Yikes.

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