In a time when other companies have been changing their business model from one of growth of one of profitability, one company made the decision to pursue a path that while painful to endure at first subsequently led them to an enviable position of being able to enjoy both. Handy, Inc. was recently profiled on the INC website with an article that chronicled their unusual approach to moving their company to a profitability position when all competitors in their category have still remained focused on large growth to penetrate as many markets as possible. The unusual strategy, the brain child of Handy co-founder and CEO Oisin Hanrahan, and one that his fellow co-founder Umang Dua and others at the top rung of the company’s ladder did not agree with at first.
The idea was simple enough, streamline the onboarding process the company used to contract with local professional cleaners to accommodate the needs of their every rising amount of bookings. They felt that they had to make the change to cut costs of several million dollars a year as they saw the possibility of further venture capital beyond their then current series C funding being limited. This was nothing to do with the company itself, but rather a trend in the VCF industry itself, where more and more VC investors are beginning to become increasingly concerned with long term sustained investment options that they are with large scale growth models.
The plan to move the onboarding process to an online and much more streamlined one by the company was a path that at first seemed doomed to fail, but perseverance and the willingness to fine tune as a they went allowed the men to take the risk and reap the rewards. This is a story that is playing out in more and more companies today that have seen the cash cow of venture capital starting to run dry in the last 12 plus months. Handy.com had been seeing the change coming since their primary competitor Homejoy had went out of business in July of 2015 after failing to raise a second round of funding. As such, they had already been developing a self-service model for customers and a self-onboarding process for cleaners, but had been delaying their rollout for the foreseeable future. The roll out of those programs much faster than expected was what led to the painful period of adjustment for the co-founders, but in the end it paid off.
Now handy is on the path to having both steady and sustainable growth, as well as ever increasing profitability. With their days of venture capital quickly receding into their rear view, there is only one thing that can be said for certain about this on-demand cleaning service, they are cleaning up more than counters and floors in their market, they are sweeping in the cash, and will be doing so for a long time.