on Feb 16 2016
The two primary pain points for consumers are: 1) the initial search process and 2) ongoing service quality.
If you're looking for a lawn pro today you'd probably start by going to Yelp, Craigslist, or the Yellowpages. From there it takes days, multiple phone calls, and an in-person appointment just to get a quote for your yard. The search process is slow and time consuming.
Once you finally find someone, they will tend to do good work for a few months before invariably spending less and less time on your property as they shift focus toward newer customers. Service quality degrades over time, until eventually you get frustrated and set about looking for someone new. This cycle repeats ad nauseam.
We built satellite mapping tools that allow us to measure the square footage of your yard, and provide you with a highly accurate quote in under two minutes. We never have to set foot on your property.
We've also built a back-end platform that handles everything from routing and dispatching to payments, scheduling, and provider communication. We pair this with matchmaking models that allow us to not only find the best lawn techs in your area, but enable them to perform even better using the lever that is software.
The result is a fundamentally better lawn care experience, rendered into its most simple, seamless form. We think this is what lawn care should look like in the 21st century.
There are 480,000 landscape management companies in the U.S. and 975,000 lawn workers. Churn is endemic, and quality is all over the map. It’s difficult for companies to keep customers happy when they constantly feel the need to chase new business. Also, 480,000 companies means 480k owners. Even the biggest companies like Scotts Lawn Care have a hard time convincing all these people who work for themselves to start answering to a boss.
No one has been able to capture a double digit share of this market. We built software that preserves company control and empowers owners to run better operations. By sitting in between homeowners and lawn services we are able to consolidate this $76B industry on one platform than benefits both consumers and companies alike.
We price according to the local market average. Then rely on the fact that our service is so much better than the alternative to compete with the lowest price options. We’re not focused on being the cheapest option even though we could. We’re selling convenience and high quality service and our fast growth suggests we can keep charging the way we do.
Our users have yards and houses in the suburbs - so our demographic skews a little older and wealthier than other services like house cleaning. The age demographic is 30-60 years old in cities like Indianapolis, Louisville, and Omaha. Our target cities haven’t been exposed to all the on-demand options you have in cities like SF and NYC - there’s less fatigue and all our users are actually really excited about this novel technology we’re providing.
Lawn care providers are exceptional at their core competency but not particularly good at the menial work of running a business. These companies often consist of a couple hardworking individuals who just want to focus on quality lawn care rather than marketing, scheduling, routing, payment processing, website design, etc. We take all this work off their plate so they can focus on what they love and do best. We advertise for them, we schedule and route our lawn providers efficiently, we handle payment processing with customers, and provide a great website for customers to book online and companies to find all the business they could want.
These companies actually make much more money with Lawn Love than they would have on their own. Rather than spend half the work week beating the pavement to solicit new customers, we send them a full schedule so they can work for pay every single hour of the week. We also use batching algorithms to consolidate jobs by area so our companies can fit in twice as many jobs per day as they used to on their own schedule - earning twice as much money while burning much less gas. We deposit payment for every job 48 hours after it’s complete so these companies have consistent cash flow for the first time ever.We provide so many minute optimizations that just make our lawn professional’s lives much easier. Lawn Love handles all the headaches of running a small business so that these mom and pop operations can focus on what they do best and make more money.
Our onboarding process is a big part of why our product is so compelling. We’ve built models of what the best lawn techs look like so we’re able to select the best professionals from Craigslist, Yelp and Google with little human effort. Then we have a ton of qualitative and quantitative metrics like ratings, reviews, and tier-based compensation to ensure quality starts and remains high.Experience is trumpeted in the industry as the most important factor for a good customer experience but it’s actually reliability that translates to high customer reviews. Consistent and effective communication is our number one criteria.
The vast majority of players in the space are small-time, mom-and-pop style companies, none of whom are particularly tech savvy. These folks are actually a great fit for the supply side of our platform, as we're able to bring them a steady stream of work, while taking care of all the customer service, accounting, and other meta-work around running their business.
There are also a few large national firms like TruGreen, ValleyCrest, and Brickman, none of whom hold more than 1-2% of the market. The 10 largest companies have collectively captured less than 10% of the total market.
These companies suffer significant cost-structure disadvantages, and are rather low-tech offerings.
There are a few other startups pursuing something similar / adjacent to us: These are companies like LawnStarter, Robin, EzHome, and TaskEasy.As far as we can see, we are both moving faster and have better unit economics than any of these companies. We believe this is a direct by-product of us having already built and scaled very similar businesses. We have the scars from hitting all the common obstacles inherent to these sorts of human-driven operations, and are able to move quickly as a result of that experience.
Lawn care is a $76 billion industry in the U.S. alone and only 30% of lawn owners actually outsource their lawn care. 70% of homeowners still do it themselves either because they enjoy mowing their lawns or it’s too painful or perceived as too expensive to find outside help.That $76 billion spent annually in the U.S. breaks down to 67% residential, 22% commercial, 3% multi-family and 7% government. Right now we’re almost explicitly focused on the residential piece of that pie.
1. We have better unit economics. We have strongly positive gross margins, vs reportedly negative gross margins for Homejoy
2. Our market is twice the size of house cleaning.
3. Our churn is far lower.
Homejoy had 20% monthly subscriber churn, vs 7% for Lawn Love. Our retention is already 3x better, and we've invested far fewer resources in product, operations, and tools to drive retention (they deployed $40M vs our ~$1M to date). Not only is our current retention great for an on-demand company at our stage, there are lots more bullets we can fire to improve this further.
4. More homogeneous supply
Lawn care is both less intimate and subjective than something like cleaning or babysitting. This reduces matchmaking difficulty, rendering the supply far more liquid.
5. Customer satisfaction is far higher. Our NPS is over 60 with a high confidence interval.
6. Services take place outside the home, and our customers are rarely present for the work.
This is significant, as it reduces logistics friction, disintermediation risk, and boosts the value of our platform as a means of managing your service.7. We're far more capital efficient.
Yard care is obviously a seasonal business but we’ve still averaged 45% month over month growth since launch 18 months ago. In the winter our numbers fall below 30% because our northern markets pause service while southern cities slow from once a week to bi-weekly to save money when plants aren’t growing as fast. This time last year we were in 3 markets and now we’re in 21 cities across the country. We’re also increasing revenue faster than we’re increasing bookings which means our average revenue per customer is growing – an excellent sign for service quality and customer satisfaction.
The most obvious next step is snow removal and winter property care. The problem with snow removal is the demand spikes so much, everyone needs service at the exact same time. Right now we’re 100% focused on lawn care and next year we’ll turn some focus to solving the supply problem in snow removal.
Our core challenge hasn’t changed since we started: finding consistent, reliable and communicative service providers so our customers get the best experience possible. Seamless booking and payment don’t matter if you walk out your door to a poorly cut lawn or worse the lawn guys just don’t show. The lawn pros are the core of our product and figuring out how to consistently find the best in every market and ensuring they remain reliable is our core challenge.
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