Homejoy, high quality and cheap but failed

In the startup environment, it is a habit to talk about successes to keep our hopes alive for the future, but it is a big mistake to forget the failures of the past and not benefit from the experiences of the past.
For this purpose, the Ecomotive team has collected the experiences of a series of failed startups, so that reviewing their failed stories may be a basis for the success of new startups in Iran’s startup community. This collection will be published and made available to the audience in the form of the story of failure. We review the twenty-fifth part of this series, which deals with the failure of Homejoy startup.

Homejoy was founded in 2010 by two siblings, Aaron and Adora Chong. Adora Chong herself started cleaning houses and did not stop even until 2013.

Homejoy, whose services are available in North America, Canada and the US, started with the slogan: “Everyone deserves a happy home.” In just a few clicks, Homejoy’s online platform connects users with a professional, verified and experienced cleaner or maid who has received high ratings from customers and for around $25-35 per hour (£13 in the UK) to have a clean and tidy home. For them, it made the shine an attainable reality.

But in the meantime, problems arose in the way of the company’s development, which eventually led to its closure. Homejoy had chosen an expensive path for its international development. It gave huge discounts to customers who used its cleaning services for the first time and set a price of $19 compared to $85 for other companies, which in turn made it difficult for the company to maintain profitability. On the other hand, a series of legal cases were formed over whether its workers are contractors of the company or its employees. Also, some workers of the company made contracts directly with its customers and bypassed the company.

On July 17, 2015, Homejoy announced that it would cease operations on July 31 of the same year. Google also hired some of the company’s technical staff.

In October 2015, three months after Homejoy closed, Aaron Chong bought the company’s database to start a new similar company called Fly Maids use. However, the identity of the founder of the new company remained unknown for a long time. Following the disclosure of his identity by one of the users and the publication of news about the new company, Chong chose to terminate the activity of Flymids in order to avoid new prosecutions for the misuse of Homejoy’s customer database.