🏠 Home Management Hoax?
Is it possible to build THE app that manages your home?
Creating a home management application has long been regarded as a holy grail problem within consumer PropTech. Countless pitches have been made, each presenting unique angles, but a few fundamental questions persist:
How do you acquire consumers?
How do you acquire all of the necessary home data?
How do you maintain that data?
How do you acquire service providers?
How do you ensure accuracy and quality of service providers?
Building a home management app necessitates solving each of these challenges effectively. Thus far, those who have ventured into this space have realized the distinctive difficulty of tackling each of these problems individually and recognized that a substantial business can be built within just one or two of these areas. Solving all five remains an arduous task.
How do you acquire home-owning consumers?
Acquiring home-owning consumers is perhaps the most straightforward challenge to address. There are various consumer acquisition channels available, ranging from direct-to-consumer marketing to partnerships with brokers, mortgage agents, title insurers, home insurers, home inspectors, home service providers, and even moving companies. Attracting individuals with the promise of an all-encompassing home management app is relatively uncomplicated. However, fulfilling that promise is an entirely different story.
How do you acquire all of the necessary home data?
This is the initial roadblock: obtaining accurate data for every facet of a home. In the case of centuries-old homes with inadequate record-keeping, or newer homes, acquiring detailed data is a formidable challenge. The app would require information such as model and serial numbers for every appliance, maintenance histories, and even annual services like gutter or ventilation cleanings. While some of this data could potentially be automated, it hinges on homeowners being active users of the app. The primary methods of collection include home inspections, manual data entry by consumers, photo uploads, or outsourcing data collection to third-party professionals.
How do you maintain that data?
Building upon the data acquisition challenge, even if data originates from a home inspection report, it rapidly becomes outdated. Constant data maintenance is necessary from the homeowner's end. Unless users are deeply committed to using the app for all aspects of home management, solving this problem proves to be very demanding. This calls for creative solutions to engage users continuously.
How do you acquire service providers?
Acquiring a network of service providers is an interesting aspect of the home management app endeavor. Some substantial businesses have already been established in the home services market. A home management app may not necessarily have to directly partner with service providers; it could refer users to established platforms like Angi, TaskRabbit, HousecallPro or ServiceTitan. However, an ideal home management app should offer vetted, direct booking of preferred service providers on its platform.
Building in this space is a clear opportunity, given the expansive and growing home services market. Angi’s annual report states that the “economy of everything home” reached $657 Billion in 2022, 10% YoY growth from 2021, and home improvement makes up the lion's share of that $657 Billion.
Nevertheless, establishing a business in this realm is a formidable task. Each service vertical is characterized by fragmentation, with disparate providers and non-standardized pricing. Companies like Angi have primarily developed large lead-generation marketplaces with inconsistent quality control, resulting in relatively low customer satisfaction scores. Building the ultimate home services marketplace requires substantial time and financial investments to meticulously acquire professionals worthy of the platform.
My favorite example of provider acquisition in the cleaning market is Tidy: Tidy built a lightweight CRM for cleaning professionals to manage their businesses. This allows Tidy to book directly with the providers they have on the platform. Tidy allows consumers to book a clean anywhere and where Tidy does not currently have a cleaning professional available, they have a small team of people who will call local cleaners until they find a top rated cleaner willing to take the job. Ideally they onboard this cleaner at the same time, growing their provider base. Each home service industry can follow this model but requires a lot of work and a lot of time.
How do you ensure accuracy and quality of service providers?
Once the marketplace is established and service providers are onboard, the work is far from over. Just like home data, provider data is dynamic, with businesses changing ownership regularly. Ensuring the accuracy and quality of service providers presents an ongoing challenge, demanding continuous vetting efforts to maintain high standards.
Conclusion
Acquiring customers, data and service providers all at the same time is challenging. Ensuring accuracy and quality at the same time is even more difficult. This fragmented space poses a massive opportunity in a growing market but is not for the faint of heart.
Ultimately, there have been and will continue to be incredible businesses built that address one or two of these problem areas. I have no doubt that in my lifetime, someone will build an app that helps me manage all aspects of my home. Until then, we would love to hear from anyone working on problems in this space and see if we can help make this dream a reality.