Don't believe in discounts; focus on experience and quality, says Urban Company chief

In order to drive profitability in a high-margin business such as at-home services, building at scale is important, said Abhiraj Singh Bhal, CEO and Co-founder of Urban Company (UC).

Speaking at the 14th edition of YourStory's flagship startup-tech event, TechSparks 2023, he said that after finally breaking even recently, the business is expected to start generating cashflows and turn profitable shortly.

Stressing upon UC's preference for quality over pricing, Bhal said he has always focused on customer experience in the hope that customers would not mind paying a premium once they got used to the level of services provided.

"We have always held that we'll not build a category on discounts, but on quality and experience. We consciously chose a path which believed that consumers should choose not for our prices, but the experience we provide," he shared.

When Urban Company started out, it had nearly 70-80 categories via a marketplace model. After quality issues cropped up, the company decided to shutter almost 96% of the total business, and focus only on a handful of them, including salon services, and home cleaning.

"Over time, we added more services such as painting and men's grooming," Bhal said, recounting the early days building Urban Company. Only once the company found product-market fit in one category did it move on to the next, he added.

New pastures

Bhal says there are several categories it wants to scale up in, including smart home devices and cleaning.

While its home cleaning service is not new, the company recently launched a subscription for bathroom cleaning after realising it was the most booked sub-category. "It took us five years to get to about 10% penetration in the professional cleaning category. After we launched the subscription, we got to 20% penetration in six months," the UC founder revealed.

Mridul Arora, Partner at Elevation Capital, Bhal's co-panelist and early investor in Urban Company, added that a few product categories that have the potential to scale include high-end groceries, pet services, and smart home devices.