A few months ago, on-demand home services startup Handy opened up its first international office and launched services in London. In an effort to quickly grow its business there, today the company is announcing it’s acquired local competitor Mopp, which also provides home cleaning services in select U.K. markets.
Terms of the deal were not disclosed, but Handy co-founder and CEO Oisin Hanrahan characterized the acquisition as a multi-million dollar, all-stock transaction that will effectively serve to merge the two businesses in London.
This isn’t the first strategic acquisition of its kind for Handy. In January, back when it was called Handybook, the company acquired San Francisco-based Exec to gain additional market share in some cities where it didn’t have as strong of a presence. Since it had previously focused primarily on the East Coast, adding Exec’s service providers and customer based enabled it to quickly ramp up in a number of West Coast markets.
In the same way, its acquisition of Mopp is positioned as a way to establish stronger market share for its home services business in London. Just 18 months old, Mopp has seen its user base grow more than 900 percent in 2014, and it now processes more than 10,000 bookings per month.
Rather than compete against an already strong player in a new market, Handy decided to acquire and merge the two businesses in London. The 25-person Mopp team, including founders Pete Dowds and Tom Brooks, will remain on board and will actually take over operations of the combined business in the U.K.
“We saw these two guys and how talented they were,” Hanrahan told me. “We thought, ‘Let’s figure out how to work with these guys rather than figuring out how to work against them.'”
For Handy the big advantage to doing so was quickly adding liquidity in a relatively new market — i.e., getting a critical mass of cleaners and other service providers signed up to serve its customers. With the acquisition closed, service providers and customers who had used Mopp’s system will be transitioned over to Handy’s backend, and the Mopp website will be powered by Handy.
In addition to London, Mopp had also offered services in Manchester, Bristol, Birmingham, and Brighton. But Hanrahan says the primary focus of the combined company will be growing its business in the U.K.’s capital.
For Handy, that follows its general strategy of trying to be the largest provider of on-demand services wherever it operates. After quickly expanding to 27 markets and growing bookings 60 percent month-over-month and growing 10 times its size since the beginning of the year, Handy is now focused on expanding its customer base and market share in each cities it serves.
“For the next six-to-nine months, I don’t see us adding markets at any significant rate. We want to be the market leader in every market that we’re in,” Hanrahan said, noting that the company has added 14 markets this year. “It will take some time before we’re operationally excellent in all of those markets.”
The acquisition of Mopp follows a few other big announcements Handy has made over the last few weeks. The company went throguh a big corporate rebrand, changing its name from Handybook to Handy last week. It also recently added new CFO Jeff Pedersen, who had previously worked at major corporations like Amazon, Dell, and IBM.
Handy has raised a total of $49 million in funding since being founded in 2012, including a $30 million Series B round led by Revolution Growth earlier in the summer. Other investors include General Catalyst, Highland Capital, David Tisch, and Bullhorn CEO Art Papas, among others. The company now has more than 150 employees and 3,000 service providers around the world.