This tech company does not own any service facilities, but has a presence in ten countries. It has employed 150 staff members, but none of them actually perform the service the company sells. Its main competition? The washing machine in your home.
The brand in question is Laundryheap, a UK-founded growth-stage venture offering on-demand dry cleaning and laundry services—one of the largest firms of its kind internationally.
The venture was founded in 2014 by Deyan Dimitrov and Mayur Bommai, at a time when on-demand services were picking up steam thanks to the rise of companies like Uber. Dimitrov noticed an opportunity in the laundry space and approached Bommai with it. Bringing together Dimitrov’s product-building expertise and Bommai’s experience with operations, Laundryheap was born.
The company offers its services on both the B2C and B2B levels, where a driver picks up a laundry order and drops it off at one of Laundryheap’s partner facilities, and then another driver returns the package within 24 hours to the customer. What this means is that Laundryheap does not own any cleaning facilities, nor employ any drivers—much like the Airbnb or Uber business model. This asset-light partnership-based configuration has allowed the company to scale its operations and expand to new markets over the years, such as the UK, the US, Ireland, Netherlands and the UAE.
“We never wanted to own any of our own facilities, but rather partner with them,” Bommai told the Abu Dhabi SME Hub. “So, we have very minimal investments [in assets]. The only investments were to put money into digital marketing and then pay the drivers and the facilities, once [the business would have started generating revenue].”
Mayur Bommai, Co-Founder & Chief Of Global Logistics, Laundryheap
While Laundryheap does not handle any of the laundry and dry-cleaning itself, it has put together processes in place to ensure a consistent quality of service across all of its partner facilities and markets—almost like a franchise would.
This is possible thanks to the AI-powered tech that Laundryheap has built, centralised within its app: The app informs partner facilities and drivers about all the processes that need to be followed; all items are tracked from the moment they are picked up to the moment they are dropped back at the customer’s door; the app plans routes for drivers; customers are also informed whether there are any challenges with cleaning their clothes, such as when a tough stain would lead to a delay or if there are any other issues, allowing Laundryheap to stay involved throughout the process.
According to Bommai, it’s this level of visibility and control that makes a difference to customers and sets their brand apart from market peers.
Expanding to the Middle East
Moving to a new market is always a challenge, especially when your service revolves around something as personal and culturally sensitive as clothes.
One of the earliest markets Laundryheap expanded to was in fact Dubai. With this transition, consumer personas changed, expectations changed (it’s not common for families in the UK to have help at home, for example, whereas in the UAE it is), and the company would now have to learn about the cleaning processes for new types of clothes items. Some of these, like silk items, required specialised cleaning that wasn’t easy to do at home, which was an opportunity for Laundryheap to leverage.
Luckily for the company, the UAE is known for its thriving service market, where customers value convenience above all. This meant that as long as Laundryheap could deliver a holistic consistent service that would handle a customer’s clothes across pickup, cleaning and finally delivery, it would settle well into the market.
And that’s exactly what happened.
Finding new opportunities during the pandemic
Like most companies, Laundryheap saw a drop in demand during the first few months of the pandemic—nearly 60% in this case. Still, looking back, Bommai said that the pandemic ended up benefiting them in the long run.
This was because Laundryheap’s asset-light model meant that the company could pursue new markets that weren’t as affected by the pandemic to try and generate revenue. Singapore, for example, was under lockdown, but it was still easy to do business there, so it was the next destination for the company. The UAE was also one of the earliest countries to ease restrictions and open up to tourists, which meant it was soon business as usual for Laundryheap.
It was also during this period that the company expanded to the US, a country where many people in urban areas don’t own their own washing machines. Still, with the ongoing pandemic, people wanted to avoid public laundromats—a massive opportunity for Bommai and Dimitrov’s firm. Couple with it the fact that Laundryheap had also introduced specialised deep clean services to help combat clothes contamination, and demand was naturally soaring.
To top it all off, the company even raised a $3.5 million Series A round in early 2021, and increased its user base in the UAE by 264%, making for one dramatic comeback.
With the pandemic mostly behind us, Bommai and Dimitrov have been focused on forward momentum.
“I think we have great plans in the next five to ten years actually,” he said. “We look at building sustainable businesses… we don't look at just scaling up very quickly.”
He noted that the demand in Dubai and Abu Dhabi has grown dramatically in the last three years—tripling in the latter emirate.
On the operational side, Laundryheap is looking to expedite turnaround times and expand its offerings, recently introducing shoe cleaning and repair services. Other than that, the focus will be on growing its presence in its existing markets like Europe, as well as the US, where it is relatively nascent still.
For 2023, the company’s goal is to grow by 3-5 times.
“When we started the company, we never thought we'd be in ten countries,” Bommai said. “And the more you start doing, the more ambitious you become. So today we are here and we're just talking about ten countries, but… the goal is we want to [eliminate] laundry as a chore for many people around the globe. We want to kind of automate laundry for many people.
“So our competition is not other competition—our competition is the washing machine.”