2 Years of Running a Cleaning Marketplace
My 2 year anniversary letter for WAND - an Uber for cleaning app
On December 10th, 2019, I launched WAND, an Uber for cleaning marketplace. Yesterday was the 2 year anniversary of that date.
It’s hard to say whether it feels like the time has flown by or whether it feels like it’s been five times as long. I suppose it depends on the day.
Yesterday to go along with that anniversary, I sent out a founder letter talking about the state of our business and what's to come. This week, I’m just going to amplify that letter on this channel.
On to it —
Into the Fire
In February of 2020, probably 70-80% of our customer side users were short term rental hosts (Airbnb, VRBO, etc). We had found our niche, leaning our development and marketing hard into the customer segment that was using our product like they needed it. Needless to say, things changed fast. We went from revenue positive to back under the bridge, as the floor fell out from under us.
Our immediate solution was to pivot into longer term rentals, but that meant rebuilding our user base nearly from scratch, and the landscape for reaching those users was going to be drastically different.
Whereas before, we would circulate in-person events for our niche and run aggressive digital advertisements towards that same user persona, that wasn’t going to work this time around. With in-person gatherings out of the question for the foreseeable future, and a flooded digital landscape driving ad costs through the roof and beyond the point of ROI, we turned to higher touch forms of customer engagement.
This meant cold emails to property managers, postcards to apartment complexes and even handwritten letters to home and condo associations, pitching the value of WAND to their residents.
It was working, but not fast enough. Prior to the pandemic’s beginning, we had learned 2 things that drove us to extend our expenditures a little too far in hindsight. Those things were:
Customer Acquisition Cost
Lifetime Customer Value
#1 told us what it cost us to acquire users, and #2 told us how much they were worth after acquisition. This data drove us to spend ambitiously to acquire as many customers as possible through the channels that were working for us, right up until they weren’t. Fast forward back to a changed landscape, and we’d left ourselves little runway to maintain our growing team and platform overhead.
Whatever It Takes
We knew we needed to diversify and look for a faster turnaround on where we could bring in revenue. For a brief stint, this looked like us doing our own formulated cleaning product, but when all was said and done, we didn’t have enough volume to make this more than a break even effort. We did a few commercial COVID cleanings, but the barriers to entry to make these kinds of gigs consistent proved too high for our contracted labor pool. Then, something else came across our plate.
At the same time as our cleaning business was slowed down, we started to hear from other service business owners who were having the opposite problem.
“I literally cannot run my business from my brick and mortar location, I need something like what you’ve built ASAP, so that I can take bookings and get employees working in people’s homes.”
Easier said than done- anyone who’s been following us from the beginning or has tried themselves, knows that the barrier to entry is high to getting a quality software platform off the ground. It could be hundreds of thousands of dollars in development expenses not to mention the months that it takes just to put that money to work and get a product into app stores.
We’d already done that though.
Repurposing our software and tribal knowledge to spin out an entirely new platform would take us a fraction of the time. So what did we do? Well, for a few months last summer, we became a full stack development agency and managed to spin out a number of marketplace platforms, spanning from shipping freight, to IT support and even news talent! Another worth mentioning that's currently in beta is BloThru- bringing hairdressers to your home, nationwide in Spring 2022.
Developing these platforms gave us the runway we needed to get WAND back on track. We used the resources gathered through these development sprints to not only keep funding our marketing efforts, but even to allocate some TLC to the core WAND platform, and push out the big 2.0 update that we did last Summer.
Where We’re Headed
Over the last year coming out of the roller coaster that was 2020 and into a more stable world, we’ve learned a lot more about where opportunity lies for our company and are currently working on some of our biggest changes yet. I’ve talked a lot about our customer side users above, but if I were to be frank, one of the things that we’ve learned as a company is that our real advocates are our cleaners, and customers in many ways are a product that we offer to this side of our marketplace.
One of our last updated features that we’ve seen the most adopted usage of has been the ability for a cleaner to invite existing customers into the WAND app and to manage that customer free from our usual 20% commission.
We did this because in keeping in touch with many of our top cleaners we learned that they loved WAND so much for it’s ability to process payments, manage their schedules, communicate seamlessly with customers and even offer insurance, that they wanted to invite customers that they’d acquired outside the platform to the app to leverage these tools further; They just didn’t want to do this at the expense of a double-digit percentage cut of their profit since they’d acquired these customers themselves rather than our lead generation funnel.
All this said, one double digit percentage that we’re noticing inside WAND, is that now a large portion of our total user base consists of these invited customers who’re using the app for free. From our vantage point, this is fantastic, but it also means that as a company we’re leaving value on the table. It’s for this reason that we’re currently thrilled to be working on a new version of the platform, that even more specifically addresses the value propositions mentioned above where we’re addressing the pain points of a more established cleaning provider base.
So here’s the scoop: We’re building an all new version of WAND, where professional cleaners can sign-up and pay a flat monthly fee to use our app as a tool to grow their businesses. We have many questions that we’re still working through in doing this, like how we may be able to blend being a customer acquisition channel and a software tool with even simpler questions like the exact pricing structure and additional features we’ll add in this new version. We’re excited to work through those challenges however, because our company is nothing if not resilient and exited to face new challenges.
The thing that nets us our intrinsic purpose here at WAND, is being a platform and now building new platforms that help individuals find sovereign streams of income. And for our customers, this purpose comes in the form of allowing folks to buy the one thing back that they never thought they could: time. Our quantifiable for this latter point based on total tracked services is that users have purchased back about 2800 hours of their time through WAND over the last 2 years. To put in a more tangible perspective, that’s over 116 days!
So thank you. Whether you’re a cleaner, customer, investor, or even just following along our journey, it’s the people behind our platform that make all this possible. We’ve got a long way to go to maximize the degree to which we’re adding the above value to the world. There are countless hours of time that we can help people buy back, and there are countless individuals who we can help to own their stream of income. We’ll be keeping at this mission, one of each at a time.
Stay tuned for more, onward and upwards.
If you’d like to keep up with Wand’s journey for more updates like this, of even use the app if you happen to live in one of the markets where we’re live, you can checkout our website here.
Next week, I’m going to talk about what makes St. Louis a positive-sum city.