Mother-and-pop shops and franchises — largely offline — account for about 95% of the laundry market in South Korea, in accordance with Laundrygo CEO Sung-woo Cho. However his South Korea–headquartered startup goals to digitize the laundry business within the nation. How? By an on-demand cell app that permits customers to put an order to choose up and drop off their laundry and dry cleansing inside 24 hours. The outfit additionally operates laundromats and sensible factories to deal with washing and drying garments.
Traders like the concept. Laundrygo mentioned right now it has closed a $37 million (49.5 billion KRW) Collection C funding spherical led by personal fairness agency H&Q Korea, with participation from returning traders SoftBank Ventures, Altos Ventures and Aju IB. New traders reminiscent of KB Securities, Hanwha Securities, Badgers Funding and Pebbles Funding and strategic investor Musinsa, a Korean style platform, additionally participated within the spherical.
Based on sources, who wished to stay nameless as a result of the phrases of the deal are confidential, the startup’s post-money valuation is now estimated at $254 million (350 billion KRW), up from $110 million (150 billion KRW) in September of 2021. Laundrygo declined to touch upon it, however Cho confirmed that the Collection C funding brings its whole raised to about $73 million in fairness and $14.5 million in debt financing.
Cho, a serial entrepreneur, launched Laundrygo’s on-demand B2C service in 2019. Cho beforehand based Baemin Recent, a subscription-based fresh-food supply service platform that was acquired by Woowa Brothers, an operator of the meals supply app Baedal Minjok, in 2015.
He mentioned the inspiration from the corporate got here from an unlikely place. After leaving his job as CEO of Baemin Recent in 2017, Cho traveled to the U.S. to relaxation and recharge; whereas within the States, his rental automobile was stolen in downtown San Francisco.
“The thief broke the window and stole all my stuff however didn’t take my laundry I put it within the Amazon Recent bag,” Cho mentioned. It occurred to him that “ordering and delivering laundry service through an app may very well be safer than I assumed if even a thief doesn’t need to have laundry,” together with, he imagined, laundry positioned in entrance of a buyer’s home.
He shortly set to work on the concept, arranging conferences with laundry specialists on the East Coast and visiting laundry factories in New York.
Laundrygo presently runs three foremost companies: laundry pickup and supply service through the app (Laundrygo), a B2B laundry service for lodges (Laundrygo Enterprise) and the laundromat service (Laundry24).
The startup additionally operates a garments alteration service, LaundryX, and has constructed its AI-powered laundry screening system, which routinely kinds laundry. Cho instructed TechCrunch that its laundromat isn’t just a self-service facility that permits customers to clean and dry their garments utilizing washing machines and tumble dryers but in addition has a contactless dry-cleaning machine within the laundromat area that customers may also use.
The Collection C spherical will assist the startup advance its sensible manufacturing unit expertise and make investments extra within the laundromat enterprise, which Cho expects to develop, owing partly to the rise of labor prices.
Laundrygo additionally has plans to broaden geographically. Whereas it simply opened its a hundredth laundromat in South Korea, it intends to open its first laundromat, Laundry24, in New York as early as subsequent 12 months. Additionally it is weighing a transfer into Japan. Certainly, Cho sees huge alternative with the worldwide on-line on-demand laundry market projected to succeed in $128.5 billion by 2026, up from $18.7 billion in 2019, per a research report.
Extra acquisitions is also on the horizon. Final 12 months, for instance, Laundrygo acquired A+ Equipment, the U.S.-based laundry resolution firm, to enter into the sensible manufacturing unit enterprise.
All cleansing is now executed in-house with Laundrygo’s sensible manufacturing unit, enabling the corporate to deal with each step, from pickup, cleansing, sorting, folding and supply. On prime of that, Laundrygo says it has developed and makes use of an environmentally pleasant detergent.
Cho mentioned the outfit — which has snapped up two different companies within the final two years — will proceed to amass if different laundry-related firms might create synergies with Laundrygo. (He steered that he is likely to be excited about buying an organization that sustainably handles clothes or that analyzes garments or garments supplies and determines their optimum wash cycles.)
He mentioned that Laundrygo has already constructed its service in a approach that collects knowledge about the kind of manufacturers, supplies and laundry info of garments and that this knowledge ought to allow the startup to diversify its enterprise.
As for proper now, in accordance with Cho, Laundrygo reached 4.4 billion received ($3.3 million) in gross sales in October, which he mentioned is greater than 20 occasions the income the corporate noticed a 12 months in the past. He mentioned that total, the corporate, which has greater than 130,000 registered customers in South Korea and greater than 500 workers, has tripled its annual gross sales since 2021.