Urban Company cuts losses by 40% in FY 2023
Urban Company pared down losses by 40% for FY 2023 while recording a 45% increase in revenue from operations. The services marketplace said that its India business reached EBITDA breakeven on an adjusted basis in Q1 2024.
Services marketplace reported a 45% growth in revenue from operations on a consolidated basis year-on-year in FY 2023. The revenue from operations stood at Rs 637 crore—up from Rs 438 crore earned in the previous fiscal year.
The Gurugram-headquartered startup, which matches customer demand for salon, home and other gig work with registered professionals, managed to pare down losses by nearly 40% to Rs 308 crore at a consolidated level in FY 2023. The rise in revenue from operations came on the back of growth in net transaction value of Rs 2,176 crore as compared to Rs 1,581 crore in FY 2022.
Valued at $2.18 billion in its last round of funding in August 2021, Urban Company also saw its costs, including employee expenses and direct and support costs, increase marginally in FY 2023. Founded in 2014, Urban Company has thus far raised $470 million across multiple rounds of funding.
The company also achieved EBITDA breakeven for its Indian business at an adjusted level for Q1 2024.
“Our India business contributes approximately 90% of our revenues. We remain focused on improving profitability for India and UC as a whole. Our strong unit economics with focused cost control will help us drive EBITDA improvement as the business scales,” said a statement issued by the company.
Apart from India, Urban Company offers home services in the United Arab Emirates.
Co-Founders of Urban Company
In the statement, Urban Company also said that the platform has seen a steady improvement in average ratings by customers, at an average of 4.8 on 5 for FY 2023. This included over 17 million services rated with 5 stars by the customers. The contribution of repeat users to net transaction value has been on the rise, with 77% of the transaction value coming from repeat customers in FY 2023—up from 72% in the previous fiscal year.
The company has also added three independent board members, including Helion Advisors co-founder Dr Ashish Gupta, former Partner at McKinsey and Co, Ireena Vittal, and former chairman of PricewaterhouseCoopers, Shyamal Mukherjee.
Over the last year, there have been multiple reports of protests by service professionals working with Urban Company demanding better commission rates. However, the company claimed that the top 20% of professionals earned an average of Rs 40,000 per month on the platform, net of all commission and related costs in the first half of the calendar year 2023.
Edited by Kanishk Singh