Indian on-demand home services startup Pronto has raised an additional $20 million in its Series B round from venture capitalist Lachy Groom, doubling its valuation to $200 million in just two months.
The platform, backed by General Catalyst, offers services such as laundry, kitchen prep and home cleaning from 125 rupees ($1.32), with workers available within 15 minutes. It competes with Urban Company’s Insta Help and Lightspeed-backed Snabbit.
Pronto raised $25 million in March from Epiq Capital, Glade Brook Capital, General Catalyst and Bain Capital Ventures at a $100 million valuation.
The company will use much of the fresh capital to scale its workforce, CEO Anjali Sardana said, adding the platform is “very supply-constrained.”
“We went from 3,000 bookings a day at the beginning of December to now over 26,000 bookings a day…we’ve been scaling supply quite fast, but it has not kept up with demand,” Sardana said, adding that she expects growth over the next six months to come from deepening its presence in existing markets.
Pronto is also expanding into services such as car washing and gardening, as well as piloting home cooks.
Like many growth-stage startups, it offers customers substantial discounts while offering steady payouts to workers. Sardana said the company has cut burn per booking by 55% in the last quarter, and remains “very well capitalised for the next year or two”.
“We’re in a business where to build habit, and also because of competition, there will be a lot of discounting for a long time. Therefore, the way to keep burn in check is to keep your fixed cost low,” she said.
“The next 24-36 months are likely to be very burn-heavy,” a BofA Securities note dated May 4 said.
Reuters
