Homejoy launched in 2012 as an online marketplace connecting homeowners with professional cleaners. The company raised $40M from Google Ventures, Andreessen Horowitz, and First Round Capital, operating in 35 cities across the US, Canada, and the UK.
Company Data
- Founded: 2012 — Adora Cheung, Aaron Cheung
- Total Funding: $40 million
- Cities: 35
- Failed: July 2015
But the cleaning business had a retention problem: customers who found a cleaner they liked would bypass the platform and book directly. Good cleaners didn't need the platform to find work. Worker classification lawsuits added existential risk. In July 2015, Homejoy announced it was shutting down, unable to raise more funding.
Key Lesson
Marketplace businesses only work if both sides need you. When customers and providers can easily bypass the platform, you have an expensive introduction service, not a business.