On-demand laundry company Cleanly goes profitable

Doing well in New York City, the company has launched a subscription service for repeat buyers

Looks like I missed a notable laundry tech company when I last wrote about this sector.

Cleanly, a Y Combinator graduate that has raised a total of $2.3 million in seed funding, today announced that it is profitable in New York City, the primary market where it operates. Specifically, the company says it is growing an average of 27 percent month-to-month (over the past year) and has contribution margins of over 20 percent.

Like Rinse, Washio, and a host of other services, Cleanly provides an on-demand laundry and dry cleaning service via a mobile app. It’s hard to avoid saying: it’s like an Uber for laundry.

Basically, you fill custom bags with your dirty laundry, which are then picked up by Cleanly's "valets." The valet delivers the bags to Cleanly's fulfillment center where each item is sorted and invoiced (with special instructions where necessary). Then they go to Cleanly's "vendor partners" ("essentially large warehouses with washing machines," a spokesperson for the company tells me), before reversing the process back to your home.

All the while, instead of sweating up and down the street with a fistful of quarters, you’ve just been chilling at home.

In an effort to secure repeat customers and drive future growth, Cleanly also announced today a new subscription service called Cleanly Reserve. Reminiscent of food delivery subscriptions from Instacart and Postmates, Cleanly Reserve offers members savings of up to 10 percent, waived fees (for delivery, cancellation and rescheduling), no minimum for delivery, and free hang dry.

The company confirms for me the service will normally cost $119 per year, but anyone who subscribes during the first three months of rollout (June, July, and August) will only pay $99 the first year.

Cleanly claims it is the first to offer a membership program designed exclusively for dry cleaning and laundry services.

“The debut of a membership service is a way to reward our faithful users, while inviting new users to experience the benefits of life without laundry,” said Tom Harari, CEO and cofounder of Cleanly, in a prepared statement.

Additionally, Cleanly also announced a revamped iOS app today, including a completely redesigned UX as well as some novel features that could only make sense for an on-demand laundry company. For example, there’s something called “Block Party,” which is like a reverse “surge pricing”: Cleanly says it will offer discounts when orders start to spike in a certain geographic area.

The app also includes “Stain Mark Technology,” so you can take photos of specific stains or defects you want addressed at the cleaners. Then there’s “Valet Tracking” so you can see the person coming for your clothes on a map.

While Cleanly offers a breadth of sophisticated features and has reached a major milestone with profitability, it’s interesting to note that it has done so in such a limited region. Indeed, most of the on-demand laundry service providers usually focus on just one or two major cities. None yet have achieved nationwide saturation, though Washio has come closest.

Cleanly tells me they hope to expand to Chicago, Washington DC, and Boston very soon.