Online home services start-ups create a new generation of entrepreneurs8 min read . Updated: 22 Nov 2016, 04:08 AM IST
Online home services firms, such as UrbanClap and Housejoy, have made plumbers, electricians their own bosses, and, at times, employers too
Mumbai: For Priya Rakesh Sanath, there was little time left after 12-hour workdays. Or money.
For two-and-a-half years, the 26-year-old toiled at a beauty parlour in the Mumbai suburb of Goregaon, working six days a week to earn Rs5,000-6,000 a month. There were no Diwali holidays or time to celebrate the Ganapati festival with visits to pandals.
That was until six months ago.
Sanath has since quit her job and started working at Timesaverz Dotcom Pvt. Ltd, an online marketplace for home services. The company provides various services ranging from cleaning tasks, beauty services, laundry management, pest control and appliance repairs to handy jobs such as that of a beautician, which is where Sanath comes in.
She now goes once a month to Inorbit Mall in the nearby suburb of Malad with her son, her brother and his four-year-old daughter, where they spend about Rs2,000 on the two children as they play in the games arcade and eat at McDonald’s. This amount used to be a third of Sanath’s monthly income, but not anymore. She now earns 10 times as much, taking home Rs60,000 a month. She also employs two girls to whom she pays Rs1,000 each day to accompany her or meet additional demand.
Like Timesaverz, there are more than 800 online companies—most of which have come up in the past—two-three years, according to Tracxn Technologies Pvt. Ltd, a data analytics company that tracks start-ups — connecting professionals like Sanath to the end consumer using technology.
These companies have opened a new life chapter for people such as Sanath, boosting their earning capacity. They have also created a new market, in the process taking share away from the unorganized and traditional businesses. It has also allowed people to create additional employment, make them feel like they are their own bosses, and assert some level of independence.
Sanath says the biggest benefit of working for a platform like this is dignity of labour and the respect she gets which otherwise was lacking.
Like Sanath, there are 5,000 people employed at Timesaverz, who have seen a minimum twofold growth in their monthly income, says Debadutta Upadhyaya, co-founder and chief executive officer of the company.
At UrbanClap Technologies India Pvt. Ltd, which runs Urbanclap.com, there are 50,000 such professionals. Mr Right Services Pvt. Ltd (Mrright.in) employs 20,000 professionals. Housejoy employs 500 beauticians and has another 10,000 services registered on it. Professionals like plumbers, electricians, carpenters, yoga teachers and even wedding planners are registered independently on its platform.
The people registered on these platforms are a generation of new entrepreneurs, not the typical people who started their business in a garage with life savings. These are self-employed individuals hitched on to one of India’s burgeoning class of start-ups. Professionals like Sanath and others do not run companies or look for investments and valuations, but work with one and successfully enough to be able to employ their own staff or grow in the way an entrepreneur would.
“The problem is threefold—availability, reliability and quality of skilled professionals. We found a huge gap and are trying to solve the problem," says Saran Chatterjee, chief executive officer of Sarvaloka Services-On-Call Pvt. Ltd, which runs the one-and-a-half- year-old portal Housejoy.in, whose investors include Amazon, which is observing this market closely and launched a similar service in the US in 2015.
“I heard about Timesaverz from a client at work at the beauty salon," says Sanath who was told the home service option was better than coming to the salon and having to wait for services. Suitably curious, Sanath, who has studied till Class XII, checked the website and applied for a job.
A growing force
Umesh Sharma has a similar story. The carpenter from Bihar’s Darbhanga earned an average of Rs12,000 working for a company called Tathastu Services in Gurgaon on the outskirts of Delhi. The second oldest among five siblings, he used to spend about Rs10,000 on rent, electricity, mobile phone charges and food, and tried to save the rest to send home to his family in the village which included parents, wife and a son.
It was a tall task. “Gurgaon is an expensive city," says Sharma, who stays with his older brother, also a carpenter.
Things have looked up in the past 10 months. Sharma has become a lot more optimistic. The 26-year-old has started work on a spacious house in his village and also intends to buy a two-wheeler. His expenses include buying new clothes for his son and brothers when he visits them in the village.
The change came after Sharma registered his services online on UrbanClap. “I heard about the service while I was browsing the Net," says Sharma, who has a rating of 4.5 out of 5 with 130 reviews on the site.
“If you are willing to work hard, there is a lot of money you can make online," says Sharma, who has earned as much as Rs45,000 per month in some months since he registered online.
Even 36-year-old Mohammed Kalam Ansari, an electrician in Noida who is associated with Mrright.in, signed up about two years ago. Ansari, who could not get a permanent job as local stores only hired electricians during busy seasons, is now working full time and also employs two people to manage the average three-four assignments he gets a day.
Scaling the segment
The nascent segment is attracting funding and attention from larger e-commerce companies such as Amazon. About 10% of the 800-odd companies have attracted over $100 million in funding in the past three years, according to Tracxn.
This is not much when compared to the investments in the online shopping sector which runs into a few billions. However, companies such as Amazon and Quikr India Pvt. Ltd, which runs Quikr.com, are among those who have shown interest in the growing segment.
While Amazon made an undisclosed amount of investment in Housejoy in December, Quikr, which has a valuation of $1.5 billion, launched home services in February and has since made two acquisitions as it looks at rapidly scaling up the unit.
“This is one of our top five verticals and it integrates well with what we do. When people rent a home or buy a car, they also require house cleaning and car washing services," says P.D. Sundar, head of home services at Quikr.com.
Sundar is considering multiple models, from partnering with service providers like Mrright.in to acquisitions, to grow the business at over 100% year-on-year.
“In Bengaluru, we have 150-200 plumbers to support us," says Chatterjee of Housejoy.—out of an estimated 5,000 plumbers in the city. “The benchmark is the cab aggregators like Ola and Uber, which are fast attracting people to register their services on the platform."
To be sure, the overall services market is still nascent.
“This market has started to get noticed only in the last one year," says Sreedhar Prasad, partner (e-commerce and start-ups) at KPMG India, a consulting firm. He explains that these online on-demand services—house help, laundry, beautician and carpenter, etc.—are limited to urban India, to the top 10-20 cities where consumers have become used to buying on platforms such as Swiggy.com and Flipkart.com, among others.
“The customers are already online and it’s just about educating them about the business," says Prasad.
UrbanClap and Housejoy are disrupting traditional companies in the listings space, like Just Dial Ltd that runs Justdial.com, New Media Pvt. Ltd’s Sulekha.com and Four Interactive Pvt. Ltd that runs Asklaila.com, as they look at controlling the entire user experience from finding the appropriate service representative in the neighbourhood, doing their background check, training them for quality services, and booking the service online and billing.
There are obviously risks in the business—the AskMe Group, which ran online search, listings and deals portal Askme.com and e-commerce site AskMeBazaar, suspended services in August due to a funding crunch. This impacted the livelihoods of 4,000 people, said a Mint report.
Home services companies like Mrright.in are looking at profitability and scale as they look at sustaining their business.
“It’s easy to add services but hard to maintain so many verticals," says Prashant Chaudhary, founder of Mrright.in. He started the company in 2013 and is now looking at breaking even, with focus on 16 categories in home services in 15 cities.
New lease of life
Meanwhile, for people like Sanath, Ansari and Sharma, the old way of living could have easily been in another lifetime.
The training, support and uniform provided by the platform helped a bit, adds Sanath, who lives with her nine-year-old son, husband and mother-in-law in a 300 sq. ft room in Goregaon’s Shastri Nagar.
She also gives her mother-in-law money to visit their ancestral village Vengurlaa in Sindhudurg district in southern Maharashtra apart from taking care of her medical expenses. Moreover, Sanath now has a bank account and is saving money. She dreams of buying her own flat soon under a state government housing scheme.
From being just another handyman or beautician, they have now become individual brands, marketing their skills. For instance, Sharma, with nine years of experience, specializes in woodwork, repairing locks and furniture, says his profile on UrbanClap.
These three, like several others, also know that there are multiple platforms and options available for listing their services, in case they become dissatisfied with the present arrangement. For now, though, they are content.
There has been another benefit for people like Sanath: “Since I have joined here, my self-confidence has increased," says Sanath, who was initially apprehensive about managing clients and payments.
Many of her peers would agree.
This is the last of a four-part series on how micro-entrepreneurs are using their skills to become independent and provide employment to others.