HouseCall, the Uber for all your home services, raises $1.5M from e.ventures
Until recently, the best we could hope in home services was a directory of local providers and accompanying collections of user reviews. That’s a very 1999 concept. But in a world where Uber, AirBnB, and Amazon Prime (not to mention the promise of drone-powered Amazon Prime Air delivery ) continue to make products and services available on-demand and via mobile, the home services sector still seems to languish in a bygone era. Several companies are beginning to nibble away at it.
One startup, HouseCall, recently emerged from beta and aims to tackle this market head on, announcing today $1.5 million in Seed financing from e.ventures. The company was co-founded by a team of four engineers who have spent several years together building mobile applications and their underlying infrastructure within the Qualcomm Labs team. HouseCall is available only in its home market of San Diego at launch, but plans to expand regionally then nationally.
The company has done a few things differently from its competition. Sure, you can order a maid through a half-dozen similar platforms like HomeJoy and Exec, but none have (yet) tackled the whole house – as each has hinted that that’s where their businesses will be headed. On the other end of the spectrum are legacy platforms like RedBeacon (acquired by Home Depot) and ServiceMagic that require the user to complete lengthy job description forms and wait for service providers to submit bids on their project – hardly an on-demand experience.
HouseCall is taking the best of both of these models. At launch the company will offer several dozen service categories ranging from electrician, plumber, and painter, to landscaper, appliance installation and repair, and auto detailing. Each will be available on-demand through the company’s mobile app, as well as its website. Heidt told me in an interview:
People who are building meaningful businesses today in mobile are taking new technology and applying to old, staid industries to improve workflow – Uber being the best example. We started by surveying a number of tech early adopter households and asking what services they needed, but have put off addressing because doing so was too much of a hassle. What we heard was certainly a broad spectrum, but really focused on things where ‘DIY’ wasn’t really an option. If you see a service advertised in a ValPack it’s pretty much in our sweet spot. Eighty percent of what we do is on a fixed price basis.
The market boasts plenty of supply and demand, but with a traditional and thus inefficient system for matching the two. Even once discovery is solved, consumers, in many cases, end up calling into a centralized, regional distributor before their job is routed to a local service provider. It’s as true for plumbers and maids as it was in the taxicab and limousine industry. HouseCall aims to bring the same level of efficiency and transparency to home services as Uber did to transportation.
Another major differentiator between HouseCall and its current competition, according to Heidt, will be its focus on curation. While competitors more often focus on breadth of coverage, his company aims to feature only the best service providers in a given market. The company accomplishes this through a combination of background checks, service tests, and existing consumer reviews.
“At the end of the day, the customers are best served when they have access to the highest quality service providers, and that’s a finite quantity,” says e.ventures partner Charles Yim.
There are two things a business must solve to succeed in this area, Heidt says. The first is frequency of use. While HouseCall’s competition has by-and-large focused on a single recurring service like housekeeping, Heidt and his team think it’s more effective to be the single source for all of a homeowner’s needs. In early testing, this has proven to be a sound assumption, as more than one third of beta users used more than one service within their first two months.
The second major obstacle, according to Heidt, is trust. Inviting a stranger into your home can be nerve racking. This is a concern that is particularly relevant for HouseCall, as it believes that women and moms will be its core demographic.
“Our users routinely tell us, ‘I care about price and I care about location, but only so much. What I really care about is that they get the job done right and that I feel comfortable having them in my home,'” Heidt says.
The company makes a concerted effort in its design and user experience to alleviate this. Every HouseCall service provider profile features a professionally taken headshot and workmanship photos. It has also added a social and intelligence layer to its reviews and ratings system, prioritizing and highlighting reviews from individuals in the user’s immediate vicinity and those in the user’s personal social graph, if they are willing to connect their Facebook profile.
HouseCall is a technology platform both for homeowners and for service providers. On the merchant side, the company has developed an enterprise-grade mobile application that handles booking, billing, and other administrative functions. In most cases, the company isn’t competing with or replacing another software system, Heidt says, but rather helping its service providers upgrade from pen and paper or their smartphone’s default (and decidedly consumer-grade) calendar application.
E.ventures is no stranger to the local services space and should be able to offer HouseCall a wealth of experience. The firm was the first investor into Angie’s List and was an investor in Groupon. According to e.ventures’ Yim, the keys to winning will be achieving scale of mindshare and delivering great customer service. Not exactly earth-shattering, but easier said than done.
“We’ll know it’s working when customers tell us they’re getting high-quality service, in convenient manner, and are happy enough with their experience that they come back and tell their friends,” Yim says. “On the merchant side, they’re just looking to get more business and to get paid in full and on time.”
Collectively, less than two percent of the $400 billion home services market goes through online and mobile platforms like HomeJoy and RedBeacon today. So while HouseCall faces competition, it’s bigger concern should be with the status quo and with the inertia of homeowners simply not maintaining their homes, rather than other venture-backed startups.
On one hand, this is good news as it indicates that the market is still open for the taking. But on the other hand, it suggests that several years and several million dollars worth of venture capital has already been dedicated to this problem with only marginal results.
HouseCall is a smart team, backed by smart investors. The company is starting small, both in terms of its geographic focus and its fundraising, but has big plans in terms of its long term roadmap. Heidt and his team will have to outduel several more well-established and well-funded competitors. HomeJoy, for example, just raised a staggering $38 million from Google Ventures and Redpoint to expand nationwide and broaden its service offerings.
Home services represents a major epicenter of family spending, and family stress. The discovery and booking problem in this category is one that is bound to be solved.
When, and by whom is anybody’s guess. But to the winner will go the spoils – and a few million piles of dirty laundry.
[Image via HoneyDoMan]