Venture

Rinse Powers Past Its Deadpooled Competitors, Launches Laundry As A Service

Whether you’re the kind of person who likes to do a reasonable load of laundry every week, or the type who starts wearing bathing suit bottoms for underwear, you’ll probably agree that washing clothes is a hassle. And where there’s a will to make something less annoying, entrepreneurs will find a way to charge you for it.

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San Francisco-based Rinse jumped into the laundry space in 2013. Co-founders Ajay Prakash and James Joun decided to change how we wash our clothes and launched a pickup and delivery service. With the traditional Rinse model, customers can pay by the pound to have their laundry picked up from 8:00 PM to 10:00 PM and delivered in three days (or rushed, if it’s urgent).

“We’ve been focused since the beginning on really thinking about all of the points of friction in the dry cleaning and laundry experience and removing [them],” Prakash told Crunchbase News of his motivation to found Rinse.

The startup has since raised $23.5 million in venture funding from investors including Arena Ventures, Paris-based Partech, and Javelin Venture Partners, and it announced today that it is launching a subscription-based wash and fold service, appropriately named Rinse Repeat.

“When you talk to customers about their dry cleaning and laundry needs, it becomes very clear that it’s much more of a chronic, recurring pain point,” Prakash said. “You always have dirty clothes, you always need help.” He added that the subscription model is a natural fit for that chronic pain point. Notably, the model is turning away from the per-pound pricing.

“Per-pound [measurements are] meant for the cleaner to understand how many pounds of clothes [it’s] cleaning. But for a customer it’s actually really counterintuitive to understand the weight of your clothes. Nobody actually thinks about laundry that that way,” Prakash said.

So, instead of per-pound pricing, Rinse users will be able to fill a small or standard-sized bag full of clothes that will be washed for a flat rate which includes delivery. The price ranges from $59/month (or $649/year) for a small bag, washed bi-weekly to $189/month (or $2,079/year) for a standard bag washed every week.

Rinse competitor Cleanly, which was founded in 2015 and is backed by Y Combinator, launched a delivery service back in 2015. Rather than supplying users with a flat rate, cleanly charges $14.99 a month (or $119.99/year) to provide perks to its most frequent users like 7 percent off of every order, one waived delivery fee per month, and two free rush services per month.

Laundry Delivery Isn’t Clean Cut

Rinse and Cleanly are operating in a challenging and competitive space that has seen multiple failures. In the U.S., on-demand services Washio and Prim, which took an “Uber for laundry” approach, shut down in 2014 and 2016, respectively. In fact, Rinse took over Washio’s customer base in Boston, Los Angeles, Chicago, San Francisco, Oakland, New York and Washington, D.C., after the company failed.

Rinse is not releasing its revenue metrics. However, Prakash emphasized that Rinse’s model focuses on that nightly pickup window, as well as an algorithm that smartly maps the delivery routes of its valets, which are paid as shift-based, part-time W2 employees. With the subscription model, the team is hoping to gain more insight into their customers’ preferences as well.

“Our goal is to continue to evolve and iterate and make sure that what we’re doing really works for the customer,” Prakash told Crunchbase News. “We’ll look at how many people are responding to the plans, we’ll look at the retention of the plan, […] we’ll learn if people are excited for annual plan versus monthly […] whatever it might be.”

If anything, a subscription service at a flat rate may allow the company to better track and adjust its margins. That means less guessing and more washing.

iStock Photo / allanswart