UrbanYou’s co-founder on the ‘game-changing’ moments in her startup’s ‘rollercoaster’ story

UrbanYou

UrbanYou co-founders Elke Keeley and Noga Edelstein

Networking with influential door-openers, eager to help female-led startups, helped the brains behind UrbanYou – an on-demand platform for household services – fast-track business growth, with their most recent feat being a $1m capital raise within the space of two weeks.

To date, UrbanYou has facilitated over 20,000 services, totaling $3 million, for its 5000 users (and counting) across Sydney and Melbourne. According to the company’s director Noga Edelstein, there are no plans to slow down: “We’re on track to triple our annual run rate for revenue, users and bookings within the next 12 months as we expand nationwide”.

She spoke to Dynamic Business about the startup she co-founded with Elke Keeley, including the key milestones in its growth trajectory and why they’re not worrying about online competitors.

DB: What circumstances led to the creation of UrbanYou?

Edelstein: I have worked in senior roles for top tier law firms in Sydney and London, and for global technology and media companies such as Yahoo!, IBM and Foxtel. Reflecting on the people I worked with, I realised they had something in common: they never had enough time to get things done around their house and when someone did take a day off work to, say, let a tradesman in…invariably the tradesman wouldn’t even show up.

The number of households outsourcing chores had been (and still is) increasing 3% per year, which indicated Australians were increasingly time-poor; however, the process for finding and booking household services was broken – it was too difficult and too time-consuming, especially to find someone you’d trust enough to let into your home.

Elke, who I knew from Yahoo! and – like me – had sat on the senior executive team, agreed there had to be a better way. Having worked with teams responsible for building and launching technology platforms, we began looking at how we could use technology to make getting jobs done around the house as easy as buying something from Amazon. We left Yahoo! and invested $15,000 of our own capital to launch UrbanYou in 2014 – and we haven’t looked back!

DB: How would you sum up your dynamic with Elke?

Edelstein: Elke’s background is in marketing/communications whereas I was a corporate lawyer. Thus, from a business point of view, our skill sets are very complementary. Plus, it’s really important to have someone who can pull you back up when the going gets tough because building a startup is a rollercoaster ride. When either Elke or I are feeling down, the other is able to focus on the positives and turn the situation around. We balance each other perfectly! 

DB: Which moments have helped define UrbanYou?   

Edelstein: Winning top prize at our first ever pitch competition was a big ‘aha’ moment. For us, it was proof we were onto something. Plus, the judging panel featured some really high-profile investors, who opened a number of doors for us, including introducing us to the Heads Over Heels network, which enables female entrepreneurs to connect with industry and business leaders.

When Heads Over Heels selected Elke and I to be two of their Portfolio CEOs, this was a game-changer for UrbanYou. Through the network, we received 125 offers of high-level introductions, which opened doors that would otherwise have taken us years to knockdown. Additionally, the Heads Over Heels team and alumni have both been a great source of mentoring and support. Since presenting at Heads Over Heels events, we’ve not only onboarded a large number of attendees as customers, we’ve also raised $2 million in total funding – this includes a $1 million Series A investment, which we raised in just two weeks this year after completing the Springboard Accelerator program for high-growth women-led businesses.

Another key moment was the decision to rebrand to ‘UrbanYou’ and pivot in the wake of our $500,000 seed funding round, last year. As ‘UrbanOutsource’, we offered a wide variety of services, including pet care and travel. Pivoting to concentrate on the verticals of cleaning and gardening not only strengthened our position as a “Trusted Household Services” provider, it meant we could be more focused with our marketing. Likewise, rebranding to UrbanYou reinforced our mandate to help users take control of their busy urban lives. Plus, keeping the heritage of ‘Urban’ in our name helped existing users and service pros retain their connection with the brand. There was an immediate uplift following the change of name.

DB: What has been a key factor in UrbanYou’s success?

Edelstein: Our laser-focus on trust and quality.  While our Uber-like tech platform enables cleaning and gardening services to be delivered in a more scalable, efficient and enjoyable way, we have a deep appreciation for the trust required to deliver these services inside our users’ home.  UrbanYou accepts less than 10% of service professional applicants into our curated network, they are all heavily screened, requiring insurance and police checks, and then we closely monitor ratings to ensure that only the best professionals remain on the platform.

Further, we have an algorithm which automatically offers jobs to the highest-rated service professionals first, which incentivises turning up on time and doing a great job for UrbanYou customers – they’re essentially competing on quality of service in order to win more work. Consequently, we have a very high customer satisfaction rate with over 60% of our monthly revenue coming from recurring customers.

DB: How does the platform benefit service professionals?

Independent service professionals can grow their businesses without needing to be online-savvy.  It’s very cost-effective because they don’t have to waste money on leads – for example, Google Ads –  that may or may not eventuate into actual jobs.  With UrbanYou, they receive an agreed rate for actual guaranteed jobs.  They also save time on going out to quote on non-guaranteed work, because the UrbanYou platform determines the price upfront for both parties.

DB: What would you say has been the biggest challenge?

Edelstein: Growing a two-sided marketplace is hugely challenging, and we learned that it’s important to grow both sides of the marketplace at the same rate.  Reaching liquidity is critical to generate confidence in the user experience, but on the other hand we need to ensure the service professionals are obtaining enough work to stay engaged in the platform.

DB: What about competition from other on-demand services?

Edelstein: We actually consider our biggest competitor to be the black market or “cash economy”. Australians spend $15 billion annually on home and garden services, yet only a small portion of this is currently being spent online. So, rather than worry about other online competitors, we’re focused on the bigger opportunity of converting offline customers to the benefits of our platform.  We are starting to see a significant portion of this spend shift to online, and the reality is that the increasing popularity of on-demand platforms globally is helping to educate both consumers and providers – thus, we’re all benefiting.

DB: What is a major focus for you and Elke at the moment?

Edelstein: We’re currently rolling out our Corporate Benefits program, having signed partnership agreements with companies such as NAB, Ernst & Young and SeventeenHundred to offer UrbanYou household services as part of their employee benefits packages. Particularly as busy working women, it’s great to see this embraced by employers trying to make meaningful contributions to work-life balance.

DB: What excites you most about leading UrbanYou?

Edelstein: When you’re running a startup, every day is different. I love waking up each morning and not quite knowing what the day will bring – I can’t imagine any other job providing this level of challenge or fulfilment.

Related: “You can’t be what you can’t see”: addressing gender imbalance in the startup ecosystem and The tech sector needs to start valuing women for their unique skills, says Silicon Valley vet.