I’m sure you have faced the issues with plumbing, cleaning, and repair of electronic appliances.

Getting a reliable service person is quite a challenge.

And then came Urban Company, which changed everything.

UrbanClap, now rebranded as Urban Company, was founded by three dynamic individuals: Varun Khaitan, Raghav Chandra, and Abhiraj Bhal.

Finding trustworthy service providers—whether a plumber, electrician, or salon services—was a cumbersome process, often involving word-of-mouth recommendations or flipping through outdated directories.

The founders recognized this gap and envisioned creating a platform that would not only make it easier for customers to find reliable professionals but also empower service providers by giving them a more structured and profitable way to reach customers.

Their vision was clear: to build a platform that could standardize service quality, offer transparent pricing, and create a seamless user experience.

This led to the launch of UrbanClap in November, 2014, a platform that quickly gained traction and set new standards in the home services industry in a never-done-before manner.

Let’s look at their start-up journey!

Problem & Solution:

Before Urban Clap entered the scene, the home services market in India was highly fragmented and disorganized. Finding a reliable plumber, electrician, or even a beautician was often a frustrating experience for consumers.

The market was dominated by small, unorganized players, leading to a lack of trust and consistency in service quality.

Customers were wary of hiring random service providers due to concerns about safety, reliability, and pricing transparency.

On the other side, skilled professionals struggled to find consistent work and often faced challenges in building a credible reputation.

Urban Clap identified this gap and aimed to bridge it by creating a tech-driven platform that would standardize the delivery of home services.

The company’s solution was to build a marketplace where customers could easily book a wide range of home services online, assured of the quality and safety of the professionals they were hiring.

To ensure trust and reliability, Urban Company implemented strict background checks for all service providers on their platform.

They went a step further by providing training to these professionals, ensuring they met high standards of service.

Additionally, the platform incorporated customer feedback mechanisms, allowing users to rate and review the services they received.

This not only helped maintain quality but also built a system of accountability.

Urban Clap’s approach effectively addressed the issues of trust, standardization, and quality in the home services market, transforming the way people in India access and experience these services.

Their model not only streamlined the process for customers but also provided a steady and reputable source of income for skilled professionals.

Now, market conditions while launch of a new platform or product plays an important in the success rate.

When Urban Company launched, India was experiencing rapid urbanization and a growing demand for convenient, reliable home services.

The rise of smartphones and the shift from informal to formal service providers allowed Urban Company to gain traction by offering standardized, tech-driven services.

Business Model:

Marketplace Model:

Urban Company functions as a bridge between service providers and customers. It allows customers to book a wide range of services, from plumbing and cleaning to beauty treatments and fitness coaching. On the other hand, it offers professionals a platform to reach a broader customer base without worrying about marketing, lead generation, or payment collection.

Revenue Streams:

The company primarily generates revenue through service fees charged to professionals for every job they complete.

This fee is a percentage of the total service cost. Additionally, Urban Company offers subscription models where service providers can pay a fixed fee for premium listings, better visibility, and more job opportunities.

Urban Company has also introduced premium services, which come with a higher price tag due to the added value, such as premium customer support, more experienced professionals, or faster service delivery.

B2C and B2B Segments:

While the B2C segment focuses on individual customers who require home services with a personalized touch, the B2B segment caters to corporate clients who expect scalable solutions with consistent quality

This diversification helps Urban Company maintain steady revenue across different market conditions.

Urban Company’s business model is a blend of technology, convenience, and strategic partnerships, making it a leader in the on-demand home services market.

Pricing:

Traditional providers often have variable pricing, which can lead to inconsistencies and a lack of trust.

In contrast, Urban Company offers fixed pricing for most services, which includes clear details about what is covered.

This approach eliminates haggling and provides customers with a clear expectation of costs.

Additionally, Urban Company’s pricing often reflects the added value of trained professionals, background checks, and quality assurance, which may make it slightly more expensive than local providers but also more reliable and convenient.

Challenges and Scaling:

Urban Company faced significant challenges in its early days:

• Onboarding Skilled Professionals:

  Many local service providers were skeptical about joining an online platform, fearing it would disrupt their traditional way of doing business.

  Urban Company had to convince these professionals of the benefits, including access to a larger customer base, regular work, and timely payments.

• Maintaining Service Quality:

  Urban Company introduced stringent background checks and regular training sessions for its service partners.

  They also leveraged customer feedback to continuously monitor and improve the quality of services provided.

• Competition with Local Providers:

  Many customers were used to negotiating prices directly with local providers and were initially hesitant to switch to an online platform where prices were fixed.

• Role of Technology:

  Urban Company developed a sophisticated algorithm that matched customers with the most suitable service professionals based on their specific needs.

  This reduced the reliance on human intervention and allowed the company to operate efficiently across multiple cities.

The company overcame these and was fairly steady. However, during Covid-19, they had no business for the first 1.5 months of the lockdown.

Initially, the company relied heavily on technology, but it soon realized that the Indian market required a more hands-on approach.

The company started focusing on one vertical—beauty services for women—after realizing that technology alone wasn't enough. This shift helped them better understand what was needed to deliver excellent home services.

This led to significant growth in the beauty vertical, which became the foundation for the company's success.

During the pandemic, Urban Company maintained consumer trust through rigorous safety measures, leading to a surge in repeat users. Word of mouth has been a significant driver of new users.

Over time, Urban Company built extensive capabilities, including 250+ training centers and standardized tools and products. This full-stack approach allowed them to deliver consistent, high-quality services.

The company focuses on four pillars for its service professionals: earnings, social security, training/upskilling, and wealth creation. They offer transparent earnings, insurance, financial programs, and even stock options for workers.

On the consumer front, many users build strong, long-term relationships with their service professionals, rebooking them regularly.

While some users may try to bypass the platform by contacting service professionals directly, Urban Clap focuses on adding value to both sides.

Service professionals also benefit from pricing power, reduced cancellations, and a sense of belonging, which they might lose if they go off-platform.

Funding Rounds & Strategic Moves

Funding:

Urban Company has raised a total of $376M in 11 rounds.

The initial seed capital of $1.6 million came from Titan Capital, SAIF Partners, Accel Partners, and notable angel investors, including Kunal Bahl and Rohit Bansal of Snapdeal.

In June 2015, Urban Company secured $10 million in Series A funding from SAIF and Accel Partners.

Their latest funding round was Series F in April 2021 where they raised $190M from 34 investors, including Wellington, Naspers, Prosus, and Dragoneer Investment Group.

Strategic Moves:

Urban Clap's rebranding to Urban Company in 2020 was a significant strategic move. This change reflected the company's ambition to expand beyond Indian borders and diversify its service offerings.

Geographical expansion was another key strategy. Initially focused on Indian cities, Urban Clap quickly moved into international markets, including Australia, Singapore, and the UAE, tapping into a growing global demand for standardized and reliable home services.

The company also diversified its services, moving beyond basic home services like plumbing and electrical work to include beauty, wellness, and fitness. This diversification was instrumental in broadening its customer base and increasing its market share.

Partnerships played a crucial role in Urban Clap’s success. Collaborations with financial institutions allowed the company to offer service financing, making it easier for customers to access high-ticket services like home renovations or beauty treatments.

Marketing Strategies:

Urban Clap employed a mix of digital marketing, influencer partnerships, and localized campaigns to build brand awareness and trust. The emphasis was on highlighting the quality and reliability of their service providers, a key differentiator in a market crowded with unorganized competitors.

These funding rounds and strategic moves not only fueled Urban Clap's rapid growth but also positioned it as a trusted name in the home services industry, both in India and internationally.

Current Status of Urban Company

The company has expanded its footprint beyond India, now operating in multiple countries, including the UAE, Singapore, and Australia.

This international expansion has allowed Urban Company to tap into diverse markets, broadening its user base and service offerings.

Urban Company continues to innovate, particularly in its use of technology. The platform has integrated AI and machine learning to enhance customer experience, streamline operations, and improve service quality.

Additionally, the company has launched new services and entered into strategic partnerships that enhance its service offerings and customer reach.

Urban Company’s story is a testament to the power of identifying a real market gap, leveraging technology, and maintaining a relentless focus on quality and trust to build a successful and sustainable brand.