LaundryMate raises Rs 50 crore from Blume Founders Fund and others, eyes expansion

LaundryMate cofounders (L-R) Tripat Preet Singh (CFO), Raghavendra Joshi (CIO), Uday Vijayan (CMO), Abhinay Choudhari (CEO), Asad Zaidi (CPPO), and Pushpendra Yadav (COO).

LaundryMate, an online laundry services startup, has raised Rs 50 crore ($6.2 million) in its pre-series A round from Blume Founders Fund, along with participation from several high network individuals (HNIs) and CXOs, like Ankit Bhati (co-founder, Ola) and others.

The fundraise comes despite the fact that the laundry services market has been a difficult one to operate in historically. Several players have folded up over the past years as they said the return on investments (ROI) or the unit economics was unfavourable. Over the past years, companies like Kalaari Capital-backed Doormint and Flashdoor, startups in the laundry space, shut shop just a few months after raising capital.

Similarly, smaller players merged with the larger ones as the market became a difficult one to survive in. MyWash being acquired by HouseJoy was one such instance.

The Indian laundry services market is, however, estimated to have a total addressable opportunity of $14 billion by 2025, with about 80 percent of the segment being B2C focused, according to analysts at Redseer, possibly motivating Abhinay Choudhari, co-founder and CEO at LaundryMate to startup in the space after founding Big Basket, the grocery delivery company.

Asked what gave Choudhari the confidence to start LaundryMate in May 2021 even as several players failed, he said his company was well positioned as services were about 25-50 percent cheaper than the industry average, in the 24-hour turnaround market.

“Ours is industries' lowest cost stack and hence pricing is affordable and not premium. We are addressing daily use case as against special needs use case,” Choudhari explained. His company was currently processing about 10,000 garments per day during peak and is confident of increasing that as they prepare to add a third shift of workers with the fresh funds.

LaundryMate has the capacity to process about 65,000 garments in a day if the full capacity is tapped into, as per the company which has an average order value (AOV) of Rs 375.

The capital will also be used to increase presence in Bengaluru, the only city it’s currently operational in, and slowly expand to Gurugram sometime next year. Over the coming 10 years, it targets setting up operations in 30 cities.

After the pre-Series A round, LaundryMate was targeting to raise another $10-15 million over the coming 6-9 months.

Sarita Raichura of Blume Founders Fund, an arm of Blume Ventures, which only backs a startup once and does not participate in follow on rounds, said that LaundryMate was well-poised to change the laundry landscape in India.

“LaundryMate has caught our attention, and we're thrilled to support them through the Blume Founders Fund program. We have had a strong belief in the untapped potential of the 'Industrialisation of laundry' for everyday consumers,” Raichura said.