Laundryheap, a London-based laundry startup bootstrapped for three years, raises £2M
Laundryheap is a London-headquartered laundry on-demand startup that has taken a different path to competitors such as Laundrapp and Rocket Internet’s Zipjet. Rather than raise VC funding, the company, which claims to already be break even and is operational in London, Birmingham, Manchester, Dublin and Dubai, has been entirely bootstrapped over the last three years.
However, that changes today with news Laundryheap has closed £2 million in angel funding, with an additional £1 million if equity crowdfunding via Seedrs planned for later this Autumn. The investment, described as a “super angel” round, is led by Simon Smith, and QVentures.
“We have been completely bootstrapped until now as we’re breaking even,” Laundryheap founder Deyan Dimitrov, who was previously at Rocket Internet, tells me. “The new funding comes… will be used to accelerate the growth in our existing cities and we will be launching in four new European cities by the end of the year. We have been able to reinvest the profits from our existing cities into launching on new markets”.
Similar to competitors, the Laundryheap service offers laundry and dry cleaning. The app lets you book someone to pick up your clothes and take them to its processing partner to be cleaned before being returned. One key difference, says Dimitrov, is that the startup is able to provide a 24 hour turn around at no additional cost. This is made possible by the company managing its own fleet and partnering with facilities that operate over night due to high volumes.
“We’re challenging the washing machine by making it really easy to have clean clothes without the hassle,” he says, noting that apps like his are tapping into a broader change in consumer behaviour where more tasks, such as laundry, are outsourced by people who are time-poor. “Our customers are busy professionals and families with children that value their free time. We also serve businesses that need laundry such as restaurants, bars, hairdressers and Airbnb flats”.
Despite emphasising that Laundryheap’s main competitors is the washing machine in people’s homes, Dimitrov says there are a number of direct competitors in different markets, naming Laundrapp and Zipjet in London, Laundr.ie in Dublin, and Washmen in Dubai.
The company makes money by charging the customer more for the service than it pays out to its fleet and service providers. “Our unit economics are healthy and we break-even in every new city within 3-6 months, andthe company as a whole is also profitable,” he adds. “Over 80 percent of our business comes from repeat customers. This is extremely important in this type of service, as this allows us to keep the growth momentum without the need to spend above the line to acquire new customers all the time”.
Published at Mon, 09 Oct 2017 16:34:33 +0000
