[The Turning Point] Looking back at what led to the launch of Urban Company, one of India's newest unicorns
Urban Company – earlier known as Urban Clap – is not the first startup Varun Khaitan, Abhiraj Bhal, and Raghav Chandra launched.
The three engineers decided to quit their cushy jobs to start a service that solved a primary customer need in India: home services.
Today, Urban Company has come a long way.
The startup, launched to create a completely new category in 2014, has now become the largest home service provider in India.
It most recently bagged Series F funding of $255 million at a valuation of $2.1 billion, in a round led by Prosus Ventures, Dragoneer, and Wellington Management, with participation from Vy Capital, Tiger Global, and Steadview. The capital infusion took Urban Company into the coveted unicorn club as it was last valued at around $933 million during its funding round in 2019.
How it began
Abhiraj and Varun, friends since their IIT-Kanpur days, often connected and spoke about entrepreneurship.
After a brief corporate career at Boston Consulting Group (Abhiraj), and Qualcomm (Varun), they both decided to take the startup plunge – they launched Cinemabox, a service that allowed travellers to stream movies on their phones in planes, trains or buses, in early 2014. But this startup shut down within six months.
Around that time, they met Raghav Chandra, an ex-Twitter engineer, through mutual friends. Raghav had also tried his hands at entrepreneurship with Buggi, an on-demand autorickshaw hailing platform that shut down soon after its pilot.
The trio connected and had stayed in touch. During one of their “intense” conversations, Abhiraj, Varun, and Raghav realised there was a gaping hole in the Indian home services market, “a lack of transparency and credibility”.
“All of us have at some point faced issues in finding the right plumber, electrician, or beautician, and in getting them to provide us services at a needed time,” Abhiraj says.
"We realised local services as an industry is such a central part of our lives but extremely broken. Current solutions haven’t improved beyond phone call lists in the last decade while other adjacent industries are leapfrogging with tech enabled-innovation,” he earlier told YourStory.
This was their aha moment, and Urban Company – then Urban Clap - was born in November 2014.
Urban Company founders
Rebranding and growth
The Gurugram-based company started making waves soon, and also caught investor attention. In 2015, the startup raised $1.5 million in funding from SAIF Partners and Accel Ventures.
At that time, it offered various services - from beauty and education to wellness and others such as CA on demand. Over the years, the company decided to focus on a few select services - home maintenance and grooming/beauty.
It developed close integration with the supply ecosystem, which runs on various levels. The service delivery experience was condensed into five levels, to make it straightforward for customers and professionals. This became their biggest competitive advantage – and the founders earlier shared that it took two years to perfect this five-level model.
Since then, the home services startup has grown by leaps and bounds. Apart from beauty services and appliance repairs, the company has also made progress in verticals such as pest control, cleaning, and painting.
In January 2020, Urban Clap rebranded itself as Urban Company, a name that is aligned with the company's ambition to be a horizontal gig marketplace, with a global footprint and leadership position across service categories.
Urban Company now has more than 35,000 service partners across 35 cities in India, the UAE, Singapore, Australia and the Kingdom of Saudi Arabia. It offers a variety of home services to consumers, including beauty treatments, haircuts, deep cleaning, plumbing, carpentry and appliance repairs.
The founders are working to penetrate further into existing markets, entering the top 100 cities in India, and venturing into new overseas geographies this year.