Sydney-based startup UrbanYou has closed a $1 million Series A raise in just a fortnight, bucking the usual trend that sees startups spending months of planning and schmoozing to secure funding.
The on-demand cleaning and tradesperson platform was backed by existing investors, with $500,000 from existing shareholder MicroEquity and $500,000 from angel investor Arun Nair.
The startup had previously raised $500,000 of seed-funding last year from MicroEquity.
After working in the large tech companies like Yahoo and Foxtel, co-founder Noga Edelstein saw an opportunity to utilise technology to aid her colleagues’ busy schedules.
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“I saw this problem with busy people trying to get stuff done around their house – it seemed there was a way that technology could solve this problem,” Edelstein tells StartupSmart.
“Uber was taking off and everything was on demand –why couldn’t we deliver home services in the same way?”
The result was a “highly curated” network of tradesmen and cleaners that can be booked through the UrbanYou platform.
Edelstein notes that maintaining strong relationships with past investors ensured such a quick raise.
“We were very fortunate to have the backing of our existing investors who believed 100% in our strategy, team and execution,” Edelstein tells StartupSmart.
Know your numbers
Edelstein also credits the Springboard Accelerator program with giving her and co-founder Elke Keeley the tools and knowledge to pitch investors a business story “through numbers and metrics”.
“That was a game changer for us,” Edelstein says.
“When we were able to tell our story in that way that was an instant win.”
For startup founders looking to raise as fast as possible, Edelstein advises they “need to know their numbers inside out”, rather than telling an emotional and personally-invested story.
“Its a business at the end of the day,”she says.
“To be able to get in front of investors with confidence and tell the business case through numbers is critical to secure funding.”
Rather than casting a wide net, Edelstein says her and her co-founder sought “strategic partnerships” with investors who could contribute “shared expertise” about the cleaning industry and gig-economy.
“We were looking for investors that could add value [not only] with money but also knowledge and expertise,”she says.
She notes that investors “really responded” to the platform’s low churn rate, which sees roughly 60% of its monthly revenue coming from repeat users.
Since launching in 2014, the business has generated over $3 million in revenue, with over 8,000 users and 18,000 services provided through the platform.
UrbanYou recently launched in Melbourne, and will be using this funding to expand nationally.