Snabbit founder seeks fresh funding in India's $60 bn housework market

By Sankalp Phartiyal

 

Household-help app Snabbit is in talks for fresh funding at a valuation of about $450 million, the latest to tap investor interest in the burgeoning market. 

 

The Bangalore-based upstart, which lets consumers order instant help for tasks like cooking or cleaning, is working on its Series D round after already snagging $56 million in the 18 months since its start in 2024, founder Aayush Agarwal, 32, said in an interview. Its previous round valued it at $180 million.

 

Startups offering household help in as little as 10 minutes have bucked the trend in India’s prolonged venture funding drought. Investors are drawn to the growth prospects of the platforms, which are targeting the world’s most populous country’s rapidly expanding middle class.

 

 

Even with several apps sprouting up — Snabbit’s rivals include Pronto and the publicly traded Urban Co. — India’s enormous home-services economy remains overwhelmingly analog. Cleaning, dishwashing, childcare and routine maintenance are largely organized through word of mouth and informal housing society networks rather than mobile applications.

 

India’s market for such services will approach $100 billion by the end of the decade from about $60 billion currently, growing at 10 per cent annual pace, Redseer Strategy Consultants estimates. Snabbit says the top 60 million urban households each spend roughly $750 a year on household services.

 

“We expect it to go to $100 billion,” Agarwal said, citing rising disposable incomes, urbanization, and the emergence of the apps. “When something that was otherwise not as accessible becomes readily accessible, the overall pie also increases in size. We’ve seen this with food delivery.”

 

Less than 1 per cent of paid household help is currently ordered through online platforms, Redseer estimates, leaving them with ample room to gain market share.

 

In markets such as the US, similar services have won users though they’ve never become major growth companies, with higher rates in more expensive economies limiting their popularity. TaskRabbit Inc. was acquired by furniture giant Ikea Group in 2017, while a competing service Uber Technologies Inc. was exploring hasn’t emerged. In China, tech giants JD.com Inc. and Alibaba Group Holding Ltd. offer help with household work.

 

Agarwal got the idea for his startup after struggling for months to find home help. He eventually asked his mother to conduct the search and hire the old-fashioned way — lingering near apartment gates, speaking to domestic workers going for jobs elsewhere and negotiating informally during morning walks.

 

“In a world where everything is a button-click away, this was an irrational amount of effort,” Agarwal said at his firm’s headquarters. The walls and furniture in his office are pink, the color worn by thousands of Snabbit’s domestic workers.

 

To match orders with workers and ensure fast delivery, Snabbit has divided cities into micro markets defined by walkability, traffic patterns and physical barriers. Given India’s often congested roads, the app even takes into account which side of the street the user is.

 

Among the sector’s challenges is further regulation of gig work. That could lead to base pay requirements and costs for training, insurance and compliance — putting pressure on platforms’ profit margins. India has begun enforcing gig-worker welfare such as social-security contributions from platforms.

 

Snabbit already guarantees minimum monthly wages, typically of $270 to $380 depending on shift structure and location. Even after years of strong economic growth, India’s average monthly pay is a relatively low $350, approximately, according to job website Shine.

 

Snabbit’s margins remain negative, according to Agarwal, largely because it’s building supply ahead of expected rising demand. In some of its more mature markets, Snabbit would be profitable if it stopped expanding, he said.