VIDEO - Plan to turn India biz profitable next year: Urban Company
India’s largest homes services marketplace Urban Company—which is valued at $2.1 billion—plans to turn its India business profitable next year. Speaking exclusively to Fortune India, Varun Khaitan, co-founder, Urban Company says, “If we want to be profitable, we could be profitable next month.” Instead, the company chose to expand and invest more in its services and offerings. From an economics and health perspective, the startup claims to have been unit positive since day one.
“We are still looking at turning the India business profitable next year. And internationally we will continue to invest more,” says Khaitan. The marketplace offers a variety of home services to consumers—including beauty treatments, haircuts, deep cleaning, plumbing, carpentry and appliance repairs. It has more than 35,000 service partners across 35 cities in India, the UAE, Singapore, Australia and Saudi Arabia.
In April this year, Urban Company raised its Series F funding of $255 million—which was led by Prosus Ventures, Dragoneer and Wellington Management, with participation from Vy Capital, Tiger Global and Steadview. “Urban Company is disrupting a large, fragmented industry that has seen low digital adoption until now. Through their technology-enabled platform and keen focus on providing high-quality, trained service partners, Urban Company has been able to achieve the very difficult task of productizing services,” says Ashutosh Sharma, head of Investment for India, Prosus Ventures.
Commenting on the business, Khaitan says that the company has expanded its price range to include the mass and luxury markets as well. For example, he added that while the company served the women customer at a ₹1,500 price point for beauty-related services, it is now looking at a budget price point of ₹800 for the mass market and a ₹3,000 price point for the luxury segment. “More services and more price points on the beauty side,” says Khaitan.
Furthermore, the company has started a home service segment for cooks in Bengaluru, which Khaitan says, “is doing well”. “Do home painting in a few cities and more home remodelling [services] as well,” adds Khaitan. In its earlier avatar of being a lead-generation marketplace, the company had hundreds of services on its platform but scaled down to just eight in 2018. “What we realised is, it’s not about the number of main service categories…… but focus on sub-categories and price point expansion,” says Khaitan.