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Why Homejoy Failed

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Re: Why Homejoy Failed

#51

Post by untog »

hammock wrote: post #46
untog wrote: post #25

I think this is a demonstration of the limits in "app-ing" an industry. Uber worked fantastically because it leans heavily on the geolocation facilities in a smartphone - you're always moving, getting picked up from different places, by cars located in different places. Homejoy had none of that. You rarely move home, and your cleaner rarely does either. Effectively, from transaction #1 you're in a perfectly replicabl…

I use a service called Handy (app-based home cleaning and handyman). It works fine. And doesn't seem to be struggling from what I can tell. https://crunchbase.com/organization/handybook/ edit: I'm in Chicago

I don't know too much about it, but just from an initial glance it seems like it is better positioned, simply by offering things like plumbers, electricians, etc - again, they aren't services you fall into regular patterns with. They're very much on-demand when there is water leaking all over your apartment.

That said, I'm sure "doesn't seem to be struggling from what I can tell" could have been said about Homejoy, until it couldn't. Venture capital makes it difficult to tell who is succeeding, and who just has money to spend.

Re: Why Homejoy Failed

#52

Post by ghaff »

prostoalex wrote: post #38
ghaff wrote: post #4

After 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 li…

> After all, as the article notes, cleaning services like Merry Maids are a well-established thing. But so are the taxi companies and hotel chains.

Well, the taxi experience has oft-discussed problems in many places. And AirBnB is typically a different experience from chain hotels. There's also the skirting of regulation thing in the "sharing" economy. But leave that aside and Uber/Lyft and AirBnB are still qualitatively different in many ways from the incumbents they're competing with. (Not saying they're universally better, just different.) However, it's hard for me to see Homejoy as being much different from a cleaning service.

Re: Why Homejoy Failed

#53

Post by cletus »

It can be pretty much boiled down to this one quote:

> ...and the steady leak of its best workers to direct employment arrangements with its own (now former) clients.

Services such as Homejoy create value by providing a market for the discovery of those seeking work with those seeking workers.

For any regular type work the incentive for the employer and the employee (if you can call them that) is to cut out the middleman. Why this comes as a surprise to anyone is a mystery.

In attempting to take a commission off future earnings companies like Homejoy just don't understand their value proposition and are simply rent-seekers. But hey, X% of future earnings from a given job into perpetuity sure makes for one hell of a revenue projection slide in an investor deck.

Look at the case where "intermediation" works and why. Airbnb and Uber spring to mind. In both cases usage is likely to be unpredictable so a direct relationship doesn't really work.

3 hours of cleaning a week on a somewhat flexible schedule? That works really well with a direct relationship.

Re: Why Homejoy Failed

#54

Post by zeveb »

kefka wrote: post #26

The underlying question is "Does skirting employment law by using only 1099'ers make a profitable business solution?" In this case, the answer is no. But the general answer to that question is "Yes, it is very profitable to upend employment law for the profit of the few, on the backs of the many."

> But the general answer to that question is "Yes, it is very profitable to upend employment law for the profit of the few, on the backs of the many."

Demand is not constant, but adjusts in response to price. Would a low-income worker rather be a zero-income worker, because no-one is willing to have him work for the wages your regulations demand?

Re: Why Homejoy Failed

#55

Post by paulcole »

cballard wrote: post #21
forgetsusername wrote: post #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.

No one should be sitting "among employees" - everyone should be in a private office with a door that closes.

Wow, pretty sweeping generalization. You can't think of anyone who might prefer an open office arrangement, or you can't think of anyone like you who would prefer it?

Re: Why Homejoy Failed

#56

Post by draw_down »

Wow, good thing all those employees ground their lives into dust for a while, working past 11pm to "get their hands dirty" for a business which was fundamentally a cash pit.

(And those are the "good jobs"...!)

Re: Why Homejoy Failed

#57

Post by tptacek »

But on this particular holiday, a booking had slipped through unnoticed, due to a website malfunction, according to a former employee. Rather than cancel an appointment at the last minute, Homejoy’s cofounder and CEO Adora Cheung grabbed a toilet brush and a vacuum cleaner. Then she headed to San Francisco’s Mission Dolores neighborhood and scrubbed.

“The customer had no idea,” said Arjun Naskar, one of the earliest employees at Homejoy, who shared the story as an example of the founders’ intense determination to succeed.

Profiles in courage!

I mean, you can take this sentiment too far (I'm sure Cheung is a great person). But this is a website premised on capturing a premium off the work of people who scrub toilets every day, day-in, day-out, right? It's telling that a tech founder doing that job just once constitutes a lede.

Semi-related reminder: tip your hotel housekeepers.

Re: Why Homejoy Failed

#58

Post by philh »

JoeAltmaier wrote: post #49
philh wrote: post #34

Earlier quoted context omitted.

With a driver, your life is in the hands of someone who has nothing to gain from getting in a car crash. With a cleaner, your possessions are in the hands of someone who might have plenty of incentive to steal your stuff and sell it.

This casual assumption that all housekeepers are thieves is galling. Its a kind of working-class bigotry that is tossed around by the entitled without even noticing they are doing it. Of course folks have plenty of incentive to not steal - they have self-respect.

You seem to be replying to a comment which has very little in common with the one I wrote.

Re: Why Homejoy Failed

#59

Post by code4tee »

Classic case of a company finding itself in the position of being a middleman with questionable value-add.

Once you introduce someone to their new cleaner there's zero motivation for the customer to not just kick out the middleman and deal with the cleaner directly. Especially when these app companies throw their hands up and say "hey they don't work for us... they're an independent contractor" if something goes wrong. They tried to have the best of both worlds (be a middleman with no responsibility) and, not surprisingly, the market called them out for it.

Re: Why Homejoy Failed

#60

Post by samstave »

untog wrote: post #25

I think this is a demonstration of the limits in "app-ing" an industry. Uber worked fantastically because it leans heavily on the geolocation facilities in a smartphone - you're always moving, getting picked up from different places, by cars located in different places. Homejoy had none of that. You rarely move home, and your cleaner rarely does either. Effectively, from transaction #1 you're in a perfectly replicabl…

For me it was price. I have three kids, so we do a lot of laundry. I simply wanted someone to fold and put away about twice a week...

Home joys minimum worked out to be about $75 per visit... So about $37.5 per hour... And I don't think folding clothes as a service worth $600 per month.

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