Today I sat down with Oishin Hanrahan. Oishin is the founder and CEO of Handy, a marketplace that allows you to book home cleaning services, handymen and plumbers online in 28 cities. During our time together, we went back to the beginning to see how he got such a big idea off of the ground in an effort to help you get your big ideas off of the ground. Enjoy!
Have comments, questions, ideas, or feedback? I want to hear it. Tweet me at william_griggs.
Topics Covered In This Episode
- For those in the audience unfamiliar with Handy, what is Handy?
- To help our audience understand the scale of the business, can you share…
- How many team members you have?
- How much funding have you raised?
- How many cities you are in?
- How many homes have you cleaned?
- How many cleaners you have on the service?
- Now that we understand the scope of the business, let’s go back to the beginning. What is the genesis story of Handy?
- How did you come up with the idea? / Where did the idea come from?
- Why this idea?
- Why did you quit HBS to work on this?
- It’s obviously a big idea. A lot of people in our audience have similarly grand visions. To help them, I want to dig into how you got Handy off of the ground?
- So you had the idea, where did you go from there?
- Who made up the founding team?
- What did the first product look like?
- Where were you with the company when you first raised money?
- What did they need to see? / What did you need to prove?
- What’s the launch strategy?
- Did you pick one city?
- If so, what city?
- How did you select that city?
- Were there certain cities that appeared more strategic than others?
- How did you start finding cleaners?
- What worked?
- What didn’t work?
- How did you start finding customers?
- What worked?
- What didn’t work?
- What were the metrics you were looking at?
- Have those metrics changed over time?
- Did you pick one city?
- So you had the idea, where did you go from there?
- How did you come up with the idea? / Where did the idea come from?
- If people want to connect with you or learn more about your company, how can people do so?
Osin Hanrahan: Great to be here. Thanks so much for having me, William.
William Griggs: Yeah, definitely appreciate your time, definitely wanna thank you for coming on the show today. You’re a busy man. We know that. You’ve got a high-flying, fast-growing company on your hands, and that’s awesome. We wanna learn a lot about that in this interview today.
The goal of the interview is pretty simple. We wanna help a lot of the early-stage entrepreneurs in the audience get their big ideas off the ground. You’ve got a big idea with Handy. We’re gonna dig into it in this interview. How do you get that off the ground? How do you start and start purveying some progress and develop some traction?
For those in the audience unfamiliar with Handy, can you kind of give us the overview of Handy and what you all offer and where you all are?
Osin Hanrahan: Yeah. So, if you need to book a home cleaning or a handyman service, Handy’s the easiest way to make that happen. We think about all the services you need inside your home, from home cleaning to handymen to plumbers. It’s a really painful buying process.
Today, Handy’s the easiest way to book those services in 28 cities. So, today, we’re live in 25 cities in the US, 2 in Canada and London. So you think about the major cities in the US, you need a handyman or you need a home cleaner, you just go to Handy.com or download the Handy mobile app.
William Griggs: Very cool. That’s a great overview. So you’re in 28 cities. There are a lot more cities that you want to get in, I’m sure, but you made a lot of progress over the last couple of years, so I wanna definitely dig into that throughout this interview. You’ve given us a little bit of the scale. I think over $30-something-million of funding; is that correct?
Osin Hanrahan: So, to date, we’ve raised over $60 million of capital.
William Griggs: 30 is half of 60, so I was pretty far off; $60 million, that’s a lot.
Osin Hanrahan: That’s all right. Yeah, so we’ve raised about $60 million in capital. We’ve got about 130, 140 folks working on the team, and we have over 10,000 contractors active on the platform in any given month.
William Griggs: Wow. That’s crazy, $60 million in funding, 140 folks on the team, 10,000 contractors. We’re gonna dig in and just see how you got that off the ground. That kind of gives the audience an understanding of the scope. So let’s go back to the beginning and talk about the genesis story of Handy. Where did this idea come from? Did you have a personal pain? Tell us a little bit about that.
Osin Hanrahan: Well, so I’m originally from Dublin, from Ireland. My background is in real estate and construction and property management. And I always had this problem of how do you find someone you can trust to do work inside an apartment? And it’s never the big jobs, right? It’s never hard to find a company that wants to bid to renovate your whole apartment. But if you wanna get something small done, you wanna get a TV mounted on a wall, you wanna get a home cleaner, you wanna get a faucet repaired or replaced, it’s really hard to find people to do that.
After that, I spent a little bit of time in venture capital and went to business school and had exactly this problem when I moved to Boston of how do you find someone you can trust to clean an apartment? And it was that − I was living with two other guys, and one of them was particularly messy. It was that pain of, like, “Oh, I’ve seen this problem before. I know how hard it is to find local service providers,” that really spurred us to think about starting a business that would make it really easy.
And if we went on and we looked at ways that service providers were selling services, so, if you’re a cleaner or you’re a handyman, it’s really hard to go out and find customers that want your services that are in your area that are willing to pay the right price and that are willing to let you into their home at the time that you wanna work. So there’s pain on both the supply side and the demand side of this business.
And what we wanted to do when we started back in May of 2012 was figure out a way to make that so seamless, figure out a way to make it so that you could come to an app or come to a website, press a button, and make a booking.
And on the pro side, look, if you’re a pro, and you’re looking to do some cleaning work, it’s really hard to figure out how you get a customer in your area at the time that you wanna work. And we thought, hey, what if you could just get to a place where, if you’re a cleaner, and you’ve been vetted by Handy, that you can just look on a list of bookings and say, “Hey, I want that booking. I want that job.” You press a button, and you know that if you show up on time, exactly how much you’re gonna get paid if you complete the work. That was kind of how it all started back in May of 2012.
We were in Boston. We raised a little bit of money. We raised a couple of million dollars in September of that year. And we launched two markets at that point. We launched New York and Boston. New York was growing really fast.
And we took a step back and we said, “Look, where do we wanna build this business? We’re gonna build a really big business that has a lot of meaning to a lot of people hopefully,” and we thought, “Where do we wanna put that?” And we thought about moving it to New York.
So, in October of that year, we moved the business down to New York, and that was kind of where we started to really meaningfully build out the first kind of core team that’s really helped us scale the business.
William Griggs: Very cool. So you’ve given us a good overview of kind of where you were. You were in the industry. You were in real estate, worked in some VCs, probably got a lot of exposure to different startups this way − worked out of VC rather − and then you were in business school, and you decided to drop out of business school; is that correct?
Osin Hanrahan: Yeah, that’s right. Both myself and my cofounder were working on this idea, and I think you touched on it in the intro here. It’s rare you find an idea that has a lot of potential upside, so an idea that can affect hundreds of thousands, if not millions of people and hopefully tens of millions of people, that you’ve got an idea that can affect that many people that has traction, you’re surrounded by a team you wanna work with, and you’ve got an investor base who’s willing to really invest in an idea that big.
And all of that kind of came together in that summer of 2012. And we thought, why would we go back to school when we’ve got this great opportunity that just has all of the ingredients that people search for, for months, if not years and years and years when they’re trying to start a business? And it was just starting to grow, and we thought, hey, why would we go back to school when we can take this business idea, take this team, take this capital, and just run with it?
Over the last three years, that same idea is what’s scaled it. We haven’t needed to pivot it or changed. It’s been running at that idea that we should change how the world buys services and running at it really, really fast. And I think, two weeks ago, we crossed our millionth booking, obviously for the first time.
William Griggs: That’s crazy. That’s an awesome overview. Like you said, you dropped out of business school because you were so passionate about this idea, but you were in Boston at the time at Harvard Business School. You moved to New York City, just for the audience keeping store at home. From there, talk a little bit about that founding team. What was it comprised of? Just start there actually.
Osin Hanrahan: So, when we originally started, it was two of us kicking around this idea, and then neither of us were engineers, so we reached out to some friends who were engineers and asked them if they would like to join the founding team and help us build the first version of the product. So I have a friend who moved over from the UK together with somebody else we recruited in Boston. So it was four of us that were kind of part of the team that worked on it that summer of 2012, and that was kind of the first evolution of Handy.
William Griggs: And then, as far as those friends, as you talked about, that had the engineering focus, were those people you had worked with in the past? Were these people that you went to undergrad with?
Osin Hanrahan: So one of them was someone who I had been at London School of Economics with, and the other person was someone who we had simply met in Boston.
William Griggs: Gotcha. So you got the little core founding team, two cofounders, a couple of engineering talents coming together for this big idea. What does that first version look like? How are you thinking through, again, such a big idea? You wanna be in probably hundreds, if not maybe 1,000 cities across the US. What’s that first version look like, as you’re getting it out the door?
Osin Hanrahan: Okay. I think the first version of any product; you wanna keep it as simple as possible. You wanna keep it at a place where you don’t invest huge resources in building it out because you don’t know if it’s gonna work. You don’t know what tweaks you’re gonna make to the model. You don’t know how exactly you’re gonna get to a place where it scales.
So the first version of the product was really simple. It was a simple frontend website that allowed you to make a booking. And on the supply side, it actually ran on text messaging, so we didn’t build out an app for the pro side of the business. It simply ran on text messages where our service pros would be messaged when jobs were available, and that was kind of the first version of the product.
And, yeah, you’re right, you wanna be in thousands of places. You wanna be in tens of thousands of places. You wanna be in millions of homes. And I think some of the advice we got was kind of two-fold. It was, “Look, don’t over-engineer the first version of a product. You don’t know what you don’t know. So just keep it really bare-bones. Keep it simple.”
And then the second thing was to really focus on geo. So, this isn’t a business where, if you’re in Boston, you care a lot whether I have cleaners in Tulsa, or if you’re in New York, whether I have cleaners in Baltimore. So it’s such a local business, and the advice we got was to really focus on areas, so to focus very distinctly on whether it was in New York or in Boston and make core parts of these cities work.
And that was something we really took to heart, which was how do we make the core of two cities work before we start to think about being in dozens and dozens of other places?
William Griggs: Right. So you’ve got that big vision, but you started with Boston and New York City, other than just the space between where you were and another big city. What else went into the factors − or what else went into deciding to go to New York City, to move the company there, as well as to open it up and service people there?
Osin Hanrahan: I think, with any business, you’ve got a series of stakeholders, right? You’ve got employees, in terms of talent; you’ve got investors; you’ve got customers; we’ve got our service pros; you’ve got legislation; you’ve got a bunch of different stakeholders in any business. And when you start, you’re trying to optimize for the most important group of stakeholders. And we looked at the talent base we were gonna need to build a big consumer-facing business. It’s obvious there’s a very deep talent pool of ecommerce in New York.
Also, it was just obvious that we were gonna be able to be nearer to more of our customers. So, when you’re building the first version of any product, if you’re not sure on what the first, second, third, fourth, fifth iteration of the product is gonna look like, you want proximity to your customers. You wanna be near a high density of customers to close that feedback loop, so that you can put customers in front of engineers on a regular basis, so that you can be in market, and so that you can help get your product in front of lots and lots of consumers.
And it was obvious even in the planning stage that New York had the potential to be a really big market and a really big business. So we thought, look, why would we put ourselves in a place where we’re not near a large number of our stakeholders? And that was some of the logic around moving to New York.
New York’s got a great startup ecosystem, really deep talent pool. And, for us, New York’s our biggest city. When you think about where this is gonna be a successful business and where we’ve already seen massive success and been very lucky, New York is at the top of the list.
So there’s probably not another city in the Western world that’s gonna be as big a business in this category. When you think about whether it’s London or San Francisco or LA, New York is just a massive market, and we have the potential to build a half-a-billion or a billion-dollar business just in New York alone.
William Griggs: Yeah. So you’ve got the proximity to the target market, the proximity to the talent that you can bring on the team. You’ve got your first version, the frontend website, the text message system. How do you start getting some of these cleaners on board?
Osin Hanrahan: Sure. So the beginning of the business was trying to match supply and demand, and it’s going out, trying to figure out, who are the cleaners? Who are the handymen? And how do you get them on the platform? And, on the customer side, how do you generate demand that’s gonna match that supply?
So, for the supply side of the business, it was simple stuff. It was referrals; it was job sites; it was Craigslist; it was Indeed; it was classified sites where we simply put up ads and drove applications. And, to date, we’ve had over half a million service pros apply to join the platform in one form or another. And I think that speaks to the quality of the product that we’ve built. It speaks to the fact that there’s real demand from the pros to be on a platform where there can earn money. But the first few applications came from classified sites, from things like that.
William Griggs: Gotcha. So you got the first version. You got the new location in New York City. And you got the first service providers that are coming onto the platform. When did you raise money in that process?
Osin Hanrahan: So we actually raised a little bit of pre-seed money right out of the gate. So we raised about $50,000.00 of incubator funding in May. And then we raised just over $2 million in September of 2012.
William Griggs: And, as far as raising that $50,000.00, did you just have the idea? Did you have a product?
Osin Hanrahan: I think, at that point, we had the idea. We had some very rough mocks of the product and maybe a very simple mock of a website.
William Griggs: And, as far as actually applying that 50 grand to the business, do you remember back to 2012 or early 2013, how you actually used that 50 grand?
Osin Hanrahan: Look, I think, with any of these things, you’re looking to generate the most value and move yourself along the curve from idea to potential business model to proven business model to scaling it. And I think, for us, that meant driving some volume at the platform.
It was probably a simple thing like hosting and probably some design work. I imagine we did some flyers. I remember pretty vividly handing out flyers to drive customers to the product to get them to use it. So I imagine it was some pretty simple stuff that the first 50 grand was spent on.
William Griggs: Yeah. So you were super early then. You were incubator stage, you said. You got the idea, the rough mocks. You get the 50 grand. Two million dollars is a little bit of a different story. What were you able to prove between there to be able to raise, between those funding rounds, to be able to raise that $2 million?
Osin Hanrahan: So, obviously, if you’re raising a seed round from venture, there’s certain things you’re looking to prove out. I think the first one was probably a little bit more information around the size of the market, that it was truly a large market. I think people got that pretty quickly.
The second was, were you starting to execute on an idea, and were you gaining real traction? So, at that point, although the math and the numbers were small, we had real customers using the product, so we had people making bookings every single day. We had pros earning money every single day. And they were continuing to use it. So it wasn’t a one-and-done, in and out. It was people using it once and then using it again and again and again and the same with service pros.
And I think those three things, so big market, team that can get things done, and customers and pros really using the product is probably what raised the $2 million.
William Griggs: Gotcha, a large market. You got the retention piece. Like you said, they keep coming back. As you scaled to the $2 million financing round, how were you thinking, as the CEO and one of the cofounders, how were you thinking about developing the team? Is it put a lot of money into engineering? Is it some back-office work? How do you think about that?
Osin Hanrahan: So I think, as we raised that capital, some of the things that we really needed to focus on were: How do we build out a product and a technology stack that wasn’t simply gonna fall over when we scaled? So I think, at that point, we went out. We really onboarded a real VP of engineering, someone who had deep, meaningful experience, in terms of building out an engineering team from one to ten people or two to ten. And that was kind of the first order of business there. We also looked at saying, okay, how do we understand a little better what are the true drivers of customer acquisition? Where can we start to think about scaling that? Those are probably the two things at that point that we focused on.
William Griggs: Gotcha. So you’re hiring. You’re investing a little bit, it sounds like, in the marketing side, so you can get some understanding around the market and the metrics, and how are you gonna acquire them, and how much does it cost? And you also invested in the backend infrastructure. I mean, VPs of engineering, those are pretty dang hard to find. What do you kind of attribute your success at finding a VP of engineering at that caliber to?
Osin Hanrahan: Look, I think, as with anything else, whether it’s investors or capital or when you think about partners, whether it’s business development partners or strategic partners, it’s the same with employees, when you’re looking to bring senior people onto the team, they’re evaluating those same things. Is this a large market? Is it a big idea? And are these people that I really wanna work with? And I think we were very fortunate to have an idea that had real traction in a big market, and hopefully, we’re not that difficult to work with.
And we went out, and we convinced a very talented VP of engineering to join us. And I think that’s kind of what talented senior folks are looking at. They’re saying, “Hey, is this a big market, an idea I can get excited about, and are these people I wanna work with?”
William Griggs: We touched a little bit earlier on the service providers and how you were able to get the service providers in through Indeed and Craigslist, etc. That makes sense obviously for the people at home, thinking through what already built marketplaces or networks can they tap into to kind of get their businesses off the ground. What about the customer side of things? Can you talk to us a little bit about early on, what were you able to do? What actually caused an impact on your customer numbers early on?
Osin Hanrahan: So, when you look at any of these models, you’re looking to say, what’s the easiest way to drive the first few customers to test if this works? And, for us, that was all the things you’d expect. So it was as simple as distributing flyers, so myself and my cofounder initially would go out, distribute flyers in Boston, distribute flyers in New York. And then we scaled that up a little bit and hired some other folks to do that. We recruited people to run what we would call street team to educate people on the street.
And then, as we became a little more sophisticated, we got into online, started to build out some SEM, build out some Facebook. And that was kind of the first set of customer acquisition.
Obviously, you fast-forward that to today, and we’re at a place where we’re doing some pretty meaningful customer acquisition across some broader-reach media, like the subway, so we run relatively meaningful subway ads here in New York. We do some direct mail. And then you go all the way through the stack, and you look at local radio. And, again, you go to online, and SEM and Facebook again are pretty meaningful channels.
William Griggs: Gotcha. So we talked a little bit about both the service side and the service providers, talked about the customers. Can you tell us a little bit about back in the day early on, some of those metrics that you were using as kind of those indicators of whether things were going right? We talked a little bit earlier about the stickiness, but can we dig in a little bit more?
Osin Hanrahan: Sure. So, look, I think even early on, you really wanna get to a place where you understand what it’s costing you to acquire a customer, what it’s costing you to acquire a pro, and how frequently your customers and pros are using the product.
So how many times − sorry − what percentage of your customers make a second booking in two weeks, in four weeks, in three months? What percentage of your pros are using the product to earn money 4 weeks in, 8 weeks in 12 weeks in, and whether the percentage of their money or the number of jobs they’re doing a week is going up or down. And I think those are kind of core to the product.
And then a level below that is what’s the happiness level? What’s your NPS score? What’s your net promoter score? Do customers love the product? Do pros love the product? And what’s your referral factor? So are your customers referring other customers? Are your pros referring other pros? And do you have a business that is truly ready to scale?
William Griggs: Very cool. That’s a great overview for most of the audience members at home, thinking through that direction. Are they proving out their hypothesis around their product solving the pain in the market? Are they proving a bunch of different stuff, using those metrics? So we’ve talked a little bit about bringing in service providers. We talked about bringing in customers. We talked about metrics to look at what the initial product looked like.
A lot of this stuff, so far, I think will be very helpful to the listeners at home because, again, we’re going back to the basics. We’re going back to the very beginning. So lots of people, again, I get emails from listeners saying, “I’ve got a big idea,” and I try to help them and guide them to basically chunking that up. How do you test those first things?
Osin Hanrahan: You should invest. If people have big ideas, you should just write them a check. You should invest.
William Griggs: Right, a check. They should just bring me on as an advisor; give me an advisor’s share [inaudible] [00:23:21].
Osin Hanrahan: Oh, come on. You should pay for them.
William Griggs: No, I’m being sarcastic. I’m being sarcastic because there are lots of people in the industry that’ll do that move, very cool. But, yes, they’re coming to me. And that’s my reason for finding you, right, to find you and say, hey, you got a big idea; you got it off the ground, instead of me hypothesizing about how to do it. I wanna get it from the source, and so that was the reason I reached out to you.
And I think most of the information we’ve covered today is, like I said, going back to the basics. It’s things everyone can do at home. But to this point, we haven’t covered any hard topics, right? It sounded really easy, and maybe that’s the case. Maybe you can correct me if it’s not. Were there a couple hard moments going through this process early on to where you thought maybe, “Hey, maybe this isn’t the business to go,” or was it all just easygoing?
Osin Hanrahan: Look, I think it’s not about individual hard moments. It’s about a volume of things that are happening every single moment of every single day. So this is a very real business. There are certain businesses that don’t have operations, businesses that don’t have customers and pros that you’ve connected.
And there are businesses like ours where you have real operations every single day. You have happy customers. You have unhappy customers. You have happy pros, unhappy pros. You have the potential to have real-time incidents at 3:00 in the morning because that’s 8:00 a.m. in London. So this is a very operationally heavy business.
And you asked about when were things going wrong? Of course, there were times when things went wrong, and it’s rarely one thing. If one thing goes wrong, you can largely deal with it. Whereas, it’s the volume of things that you’re dealing with on any given day that causes you to have issues.
And there were times when the system overloaded and failed and took way too many bookings in the early days. It took more bookings than we could truly handle. And myself and my cofounder and everyone in the office needed to go out and hustle and lift boxes and clean homes to fill the gap. And that was in the very early days, something that we didn’t wanna do, and it was something we wanted to do to make sure that we made customers happy.
There were other times when payment systems would have failed, and it got to a place where our automated batch payment to pay hundreds of pros a day back then would have failed, and we would have manually written checks to fill the gap.
So, yeah, of course, there are lots of times when things don’t go the way you want them to go, and it’s less about that. It’s more about how you deal with it. You say, “Okay. What’s the right thing to do? How do we address this problem? And how do we try and make most of our customers happy and make sure that we motivate a team to do it?”
William Griggs: All right, cool. And that’s definitely a good overview. I appreciate you giving our audience a realistic perspective on the business, right, so they know that it wasn’t as easy for you, and they shouldn’t expect it to be as easy for them. They should, like you said, figure out how to respond to those difficulties, not just try to avoid them.
Osin Hanrahan: Absolutely. Look, you wanna make sure that you’re going into starting a business with a level of awareness that there’s gonna be highs, there’s gonna be lows, and you’re gonna have an opportunity to surround yourself with people who hopefully are gonna support you through that.
William Griggs: Yeah. This has been a great interview. I really appreciate your time coming on, going back in time to early times of Handy, talking us through the highs, the lows, the tactics you used, the things that worked, the things that didn’t work. If people wanna connect with you, or they wanna learn more about Handy, how can they do that?
Osin Hanrahan: Yes, sure. You can just go to Handy.com, or you can just follow me on Twitter and happy to get involved.
William Griggs: Okay, cool. So how much did Handy.com set you back?
Osin Hanrahan: I don’t even think about it.
William Griggs: Good answer, great. I’ll put those links in the show notes for Twitter and for your URL. Osin, thanks for joining us today.
Osin Hanrahan: Thank you so much.
Oisin Hanrahan’s Bio
Prior to founding Handy, Oisin founded MiCandidate, a service that provided real time political content to media companies in 25 European countries. MiCandidate was acquired in 2009. He also founded Clearwater Group, a real estate development business in Budapest, Hungary.
In 2009, Oisin co-founded The Undergraduate Awards, a foundation that supports and celebrates outstanding undergraduate students globally. Oisin is also a WEF, Young Global Shaper.