TaskRabbit is a mobile marketplace where local customers can use its platform to obtain any type of service transactions like home repair, cleaning, and other various housing necessities. This online service marketplace was established in 2008, having remarkable investors, such as Floodgate, Startups, and many other ventures.
The company has a well-established business strategy. Thus, it has boosted the funding capital from the ventures by $37 million. Apart from this, the firm generates revenue in three ways: registration fees, service fees, and trust support. In 2017, the company was taken over by Ikea Group.
What is TaskRabbit?
In the early years of TaskRabbit, Brian Leonard, Kevin Busque, and Leah established the company in 2008 that is based in San Francisco. After 1 year, the business raised its first round of finance, securing $1 million in startup capital. Moreover, the company’s early days were marked by its association with the on-demand economic model. It was an initial service provider that had the same offerings as Uber and Airbnb. In addition, the company released an app that allows users to utilize the service conveniently.
Other than that, the firm secured $5 million in fundraising in May 2011, marking the company’s first multi-million-dollar round of financing. The second round of funding came in when the company could raise $17.8 million in a few months’ time. Then, this service company entered a global market that was launched in 2013. Due to the needs of tasks, the CEO, Leah Busque resumed the work, and the company brought the delivery service.
Moreover, the home care service firm acquired two competitors, which were One Jackson and SkillSlate company. Both were online websites offering kids’ attire. In addition to owning the companies, TaskRabbit also hired Anne Raimondi to become chief revenue. This former One Jackson’s CEO was in charge of the revenue department. At that time, the firm hired Stacy Brown as its COO as well.
The company continued to improve existing products and innovate new products every year. Thus, it acquired a business-to-business product in a later year. This product works in a way that connects other companies to the Taskers that are looking for jobs. A few weeks after launching the product, the company had more than 15,000 Taskers registered.
It reported that it has cut off 20% of its 65 workers as part of a strategic reorganization exercise in 2013. The company developed and launched the app on the Android version in that year, allowing Samsung users to download the service platform for free.
The firm encountered its most significant test when it declared that it could shift away from an eBay-style auctioning system. The system works by allowing Taskers to make a bid to get their assignments. As of now, the model has been shifted to direct booking, in which businesses are open to discussing directly with the target employees. In this way, communication would be more convenient. In addition, by doing so, the company would not charge hourly fees like before because of the new fixed-rate charging system.
For the last 3 years, TaskRabbit has experienced a severe downfall in users using the service due to a global pandemic, Coronavirus. Like other service and tourism industries, the company’s services were stuck and put on hold because of the social distancing and lockdown policy of the government to protect the widespread of Covid-19.
Unlike other companies, TaskRabbit still survives this global pandemic. The company is still operating in both the United Kingdom and the United States, consisting of more than 1,000 employees working.
How Does TaskRabbit Work?
TaskRabbit is an online platform where it connects customers to a lot of local service providers to get the service done. Through the platform, users have plenty of choices to select the services, including gardening, furniture assembly, home repair, running errands, cleaning, and so forth.
In addition to many options of services, the company acquires a mobile application with a user-friendly interface that is convenient for its customers and Taskers. For those who want to start using the platform, they can go to the website here. From there, they download the app on both IOS and Android versions.
After downloading, you will be asked to provide the job that is expected to be offered, the length of the assignment, and the ZIP code. On the app, you will be able to see all Tasker’s availability that meets your job needs along with the hourly rates. In addition, you could further filter the search to narrow down the Tasker level to an Elite level.
Other than that, TaskRabbit features a star-rating system for customers as a review and reflection towards the services and platform’s performance. By doing so, it allows customers to give feedback experience. In return, the company takes all the reviews as helpful input to further renovate and develop the new features.
Moreover, the users can select the date and time for paying for the service. Also, they can make a direct call to the hired Tasker for more information and communication via the app. Every once in a while, the company conducts a comprehensive background check of the service partners in order to make sure they do not perform any criminal convictions.
What is The TaskRabbit Business Model?
Similar to Airbnb and Uber, TaskRabbit’s business approach goes between those who want assistance and those who are eager to earn hustle. Standing in between the lines of supply and demand, the company attracts so many users to its platform. Additionally, they provide a number of alternatives for clients to ensure that they may choose the best possible individual to serve their needs. Not only for that, the app brings the finest feature in the diversity of choices available to both taskers and task posters.
Initially, this type of business approach is known as the aggregator model. The company does not acquire any physical assets or inventory. Simply speaking, all products are online, and the only physical asset that the company owns is the office. Besides, the company makes a great convenience for taskers to earn hustle while helping the task posters to find the task provider with minimal effort and time. The task-outsourcing company has been on the market for some years and is well-known for its reliability. The primary responsibilities are as follows:
- Performing the function as an intermediary between Taskers and task posters
- The company provides customer support to customers in choosing the most qualified Taskers
- Keep track of the exchange of funds and provide a means for payments to be made electronically
- Improve networking between customers and task posters
- Increase Taskers registering on the app to bring more options
- Continue to update the app in order to make adjustments in response to new demands.
TaskRabbit does an excellent job at keeping the app updated. Previously, taskers usually agreed to take on the assignment and finish it later. However, in order to catch up with a great demand from customers, the firm has shifted its approach for taskers to finish their assignments as fast as they can.
How Does TaskRabbit Make Money?
Every company has its own way of generating revenue; otherwise, it does not survive with the expenses. Its initial revenue stream is made by charging Taskers a commission regarding TaskRabbit. In other words, every Tasker will pay a fee for using the platform to offer service to clients. The company charges Taskers a 15% commission fee as a service fee once they complete any assignment for the customers. The fee is only deducted from the Taskers’ account in the payout system. Although the company is struggling with the global pandemic, TaskRabbit has made over $100 million in 2019, with more than 4 million bookings on the app.
Another source of revenue that this service platform has is trust and support fees. Generally, clients who hire the Taskers to serve their demands via the platform will be charged with this type of fee. The charging fee is fixed for any transaction that occurred using the platform.
In addition, TaskRabbit charges the customers the trust and support fees, including user protection, users satisfaction, customer support, customer review rating, Tasker’s background checks, and many more. The company does it to ensure the highest quality provided to the clients and the company’s long-term sustainability and vice-versa.
What is more, the fee is usually 7.5% per transaction. Therefore, the 15% fee charged from the Taskers and 7.5% fees from the task posters could make an overall 22.5% in revenue for every service done via the platform.
Other than service and support fees, the company also charges everyone who registers to be a tasker on the platform. The registration is one-off and non-refundable because it prevents any fake registration that might defame the service ecosystem. Since its establishment, the company has had more than 140,000 registered taskers as of 2019. On top of that, the registration fee collected is 25$, generating $3.5 million in revenue.
TaskRabbit is the earliest service-providing platform that operates under an aggregator business model. Due to its technological base, the company is one of the most successful businesses that owns no tangible assets, except their San Francisco office and another office in the UK. This is because the company was launched in between the demand and supply of the people who want to earn hustle and those who seek home services like home repair, cleaning, gardening, and so on.