Handybook leverages services via smartphones

24 Dec 2013

Oisin Hanrahan, CEO and co-founder of Handybook

There are those for whom life begins at 30. For Oisin Hanrahan, tech entrepreneur, who has just turned 30, his latest business venture Handybook is a case of third time lucky.

Handybook provides housecleaning and handyman services much the same way the app Hailo quickly provides users with taxis, via a few taps on an app.

The Trinity College Dublin economics graduate was selling apartments in Budapest when the property market collapsed in 2008. Having extricated himself from the property crash, Hanrahan went on to work with Paddy Cosgrave, founder of the Dublin Web Summit, on a short-lived website called MiCandidate, aimed at helping politicians manage their campaigns. It can be said the Dublin Web Summit, which brought 10,000 techies and investors together in October, was founded on the ashes of MiCandidate.

The third phase of Hanrahan’s entrepreneurial career, Handybook, appears to have – just like Facebook – emerged from earnest conversations in dorm rooms at Harvard University in the US state of Massachusetts.

After MiCandidate shuttered, Hanrahan moved to London where he got to work with Accel Partners, one of Silicon Valley’s biggest investor firms.

Birth of an idea

“While I was there I watched businesses like Hailo coming through and knew that mobile devices in people’s hands were going to be the gateway for retail and commerce in the years to come,” Hanrahan said. “I tried to imagine if you could apply location-based on-demand services to other markets but the idea eluded me.”

So he moved to Boston and went to Harvard Business School. In his first year, he shared a room with two guys who were as “messy as hell” and Hanrahan began to lament how hard it was to find someone trustworthy to work in his home to do things like hang a flat-screen TV or do simple home cleaning.

“We discovered that people who provide these services would show up late or weren’t vetted. We decided it was time to work on this problem,” Hanrahan said.

So after raising US$50,000 in seed capital, Handybook was born. The company raised US$2m in October last year and in recent weeks raised a further US$12m in financing, primarily from existing investors, including General Catalyst Partners and Highland Capital Partners.

Growth of Handybook

In the last six months, Handybook has expanded from five to 35 people. The company has more than 1,000 service professionals using its platform to provide household services to homes and apartments in eight US cities, including New York, Boston, Miami, Chicago, San Francisco, and Washington, DC.

Just like popular mobile apps Hailo or Uber, users can go to their smartphone and have a pre-approved cleaner or handyman arrive at their home any time they’d like.

Handybook’s service professionals are doing thousands of jobs a week on the platform and they’re happy with the pace of growth. The key now is to manage this pace of growth, Hanrahan said.

“The consumer is changing, they like to touch their smartphone with their finger and make things happen,” he said.

A third of Handybook’s customers are on subscription home cleaning and the cleaners are trained to notice things like leaky taps. Handybook can then send customers a push notification to let them know and get it fixed.

Hanrahan likens Handybook’s business model to Amazon Prime, a service Amazon offers whereby consumers spend US$70 a year and all their shipping is free.

“The idea of free shipping means they are likely to spend more time on the site and spend money on products,” Hanrahan said.

What Hanrahan hopes to do with Handybook over time is help customers improve their home through deeper engagement with the Handybook brand.

“These on-demand services that you are starting to see emerge on mobile devices are just incredible. Push a button and I could have a Hailo cab pick me up from wherever I am standing to whisk me off to the airport,” Hanrahan said.

“I would say you are definitely seeing a movement where offline business models are colliding with new technology-driven services delivered by mobile apps where efficiencies are being enjoyed at the push of a button and consumers are being amazed.”

Hitting liquidity

Hanrahan said he estimates the cleaning/handyman market Handybook targets is valued at US$50bn a year and in the same way mobile is enabling a shift away from radio cabs with Hailo, he said being in the right place at the right time is critical.

“It’s a marketplace business and it’s about hitting liquidity. Once we hit liquidity in a geography like a city that needs a technological shift it is very hard for other businesses to come in an compete with us.”

Handybook is the dominant player in New York when it comes to a home cleaning service online and it’s hard for others to match that, Hanrahan said.

The devil, Hanrahan added, is in the detail. This requires being organised both technologically and in terms of having the professionals willing to use the platform.

“You don’t press a button on Hailo only to be told your taxi is to come an hour later. The same is true with a cleaner or a handyman, you have to provide the right customer experience. Liquidity is crucial, it’s about building critical mass.”

The key to achieving critical mass, Hanrahan said, was building a system the professionals would like to use.The traditional worker for a house cleaner agency or a handyman would traditionally receive a schedule the day before and would have to ring a customer to make sure he or she was home. It was a messy, clunky experience and often meant jobs didn’t happen, said Hanrahan.

“Our app to them is like having an ATM in their pocket. They just know that there is going to be work there and if they show up and do it when they are supposed to and carry out a satisfactory job, the money will be in their bank account on Monday morning,” Hanrahan said.

“That’s a pretty good experience if you are a service professional. It’s a flexible but stable income.”

Hanrahan said the word on Handybook has spread through the service professionals’ ranks and 150,000 people have applied to join the platform.

“We can only accept a small percentage of them because there’s a huge process involved in doing background checks, references, interviews and the rest. We have to make sure that anyone who operates on our brand has a high referral rate.”

The start of service-via-smartphone

Hanrahan added he believes consumers are only at the beginning of a commerce movement where they order real-time physical services via smartphones.

“We are so early in terms of the amount of money that will be channelled through mobile devices,” he said. “In three years’ time so many more services will be available through mobile, and it will be all about meaningful, tangible services.”

It works for Handybook in Manhattan, Boston and LA, and the challenge the company faces is to scale up as quickly as possible yet at the same time maintain quality of service, Hanrahan said.

For the moment Hanrahan is content to keep Handybook in the US with no plans to bring the business model overseas. The company is looking at how it can migrate the service to places like the outskirts of Boston, and that’s how the team thinks about the next six to 12 months.

“With any business, you need to ask yourself who are the stakeholders and how do they interact with the ecosystem they are trying to serve? Think about any business that is starting up – there is a need for capital, employees, customers and engineers – the question should not be ‘should we be in this city?’ but ‘what best suits the stakeholders?'”

Hanrahan is also happy to continue living and working in New York and gets back to Dublin every two to three months.

Irish start-up energy

From his vantage point in Manhattan, Hanrahan said the start-up energy coming out of Ireland is impressive. “I think Paddy has done an amazing job with the Web Summit and some of the companies we are seeing arrive on the scene are incredible – companies like Trustev, Soundwave, Logentries. The ecosystem is really being built up.”

However, he said there is a need to focus on specific areas of opportunity rather than a scattergun approach.

“If you’re going to be excellent at something, my advice is be excellent at mobile. There’s going to be a wall of money flooding into mobile and there is going to be a lot of demand for tools like mobile analytics, payments and the rest,” Hanrahan said.

“There is going to be a huge opportunity to power the mobile economy and Ireland should try and develop itself to be a centre of excellence for mobile rather than trying to focus on 16 different areas.”

A version of this article appeared in The Sunday Times on 22 December

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years