On-demand home services provider Serviz raises $12.5M

Serviz is an end-to-end service, from recruiting providers to providing paperless invoices

As anyone who owns a house knows all too well: there is always something that needs to be fixed. ALWAYS. It never ends. But getting things fixed is such a pain. There's the problem of trying to find the right person, which typically requires asking everyone else you know if they found someone who is actually good. And then there is the issue of paying them what can easily amount to thousands of dollars.

Getting things fixed should not be so difficult. And if Serviz, a new on-demand home services provider, has its way, it won't be for much longer.

The company has just raised a $12.5 million Series B round of funding, it was announced on Tuesday. The round was led by PointGuard Ventures, with existing investors Andy Sheehan, Jeff Stibel of Stibel Investments and Serviz founders, Zorik Gordon and Michael Kline, also participating. With this funding, the company has now raised a total of $20 million of equity financing to date. The company's prior round was led by Groupon.

Spun off from ReachLocal earlier this year, Serviz provides an end-to-end home repair experience. The company goes out and sources top service providers, such as handymen, plumbers and electricians, interviews them and checks their licenses. When they are brought on board the Serviz platform, they are covered by an umbrella insurance policy and the customer pays them through Serviz.

"We believe fundamentally that the whole process of booking and buying local services is too hard. It's too hard to find a provider, there's no transparent pricing, and it's hard to ascertain who is good or not because there are no brands in the space, like there are in retail," Gordon, who is also CEO of the company, told me in an interview.

"We want to revolutionize that process and find out how we can make the experience exponentially better for consumer through tech and business model innovation."

The company is big on transparency, on both the front and back ends. That means not only giving the picture and the background of the service provider, but being open about the price as well. And, on the back end, all the providers carry iPads so that they can set up an appointment in as little as 30 seconds and the customer can then track them, much like they can with an Uber driver.

All of this makes the experience of hiring someone much less painful for the customer in terms of price.

"We found that existing service providers, the established ones, were gouging consumers. Their markup was sometimes as high as 300% or more percent," Gordon said. "They are charging hourly rates of well  over $100 for  a job that should be $40 to $60. The hard part is that no one else publishes rates."

Consumers, he said, can expect to save between 30% and 50% by booking through Serviz.

For the providers, the advantage of coming onto Serviz is that they get to compete with the larger providers. Serviz typically works with independent technicians, who don't have the resources and reach of bigger competitors. 

Serviz will use its new funding to expand its service offerings to the top 20 home repair categories, including pest control, and will expanded into an additional 20 geographic markets in the next one to two years. Right now it only operates in the Los Angeles and Orange County areas.

Eventually, Gordon sees the company expanding beyond home repair, to services that includes healthcare and law. But the real differentiator will be its on-demand capabilities.

"We think on demand, in the next five to ten years, will become majority of how people transact. Uber is a good example of this happening quickly in a vertical," said Gordon. "The platform we’re building can extend into all types of home services, and even to professional services, like healthcare and legal services, where the same fundamental problem exist of people not knowing who to call, and they don’t know how much it costs, and there's no brand to trust."

Though it doesn't disclose how many users or professionals it has currently, Gordon did reveal that it has had "well over 10,000 jobs in the first five months,"  and that it is growing 50% month to month.