REWIND exactly four years back. It’s a different world altogether: 4G is a niche, people depend on rickshaws/taxis for transport and food is largely ordered by calling on the restaurant’s helpline.
There are only a few startups in the tech sector and most of the brands are owned by the Rocket Internet. Careem, though now a household name, is just a small company limited to Lahore while Uber is yet another global giant we don’t have access to.
Nest I/O, one of the oldest incubators in Karachi, releases the news on Jan 28, 2016 that its cohort 1 startup, Sukoon.com, has closed a seed investment round from Islamabad-based and become the highest-valued portfolio company.
“Sukoon.com.pk is Pakistan’s 1st online platform for connecting individuals looking for household services with top-quality, pre-screened independent workers. From home cleaning to handyman services, Sukoon instantly provides you the best, safest and affordable professionals at the touch of your fingertips. With a seamless booking process, simple payment method, and a 100 per cent customer satisfaction guarantee, Sukoon is the smartest way to book home services,” the startup’s Crunchbase reads.
The Karachi-based startup was founded by Qazi Umair and Shoaib Iqbal, both graduates of the Institute of Business Management and former employees of Rocket Internet.
It quickly shot to fame (whatever that means in the local scene) and made a brand for itself, in part thanks to a catchy name. Operations scaled up and they got some technicians on company payroll plus a network of ‘independent contractors’.
By April 2017, the startup had closed a small bridge round to get by before their planned (or hoped) sizable investment.
But come August of the same year, the founding CEO resigns and in his place joins a hired executive to spearhead the company. A month or so after that, the other founder and COO leaves as well. The misery doesn’t end here: even the external guy that was brought in abandons the sinking shape after a year.
Now fast forward to today: Sukoon is no more and when you open its website, the page shows Error 526. By December 2019, they shut operations and stopped taking any orders.
Even their Facebook page, which once had over a 100,000 likes reportedly, has been deleted. What exactly went wrong and where, that eventually led to the downfall of a potentially disruptive (forgive me for the clichés) startup?
“We didn’t get the kind of money required to properly scale and when it ran out, that obviously affected our growth. This is why we went for the bridge round too,” Umair, the COO of erstwhile startup recalls.
In many ways, Sukoon also highlights that ages-old issue of investor versus founder. Many a startup have fallen due to misalignment with their financiers and while we don’t know what panned out behind the scenes here, it does suggest that those who poured in the money had a different vision or at least expectations.
Especially, in the Pakistani scene where there has historically been a dearth of capital, there is often an imbalance between the bargaining powers of the two sides. Lack of institutionalised financiers has been a complaint of many entrepreneurs as they tend to interfere in operational matters more than they should.
But the issue probably goes beyond investors and founders. The startup was likely exposed to one major risk many of the services-related marketplaces experience in Pakistan or even abroad: both the supply and demand had an incentive to bypass the middleman, basically Sukoon itself.
Its core offering was a convenient way to book and pay for handyman services, ensuring trust. But after a few dealings between the two concerned parties, enough rapport generally develops that they cut the online platform out and save themselves the commission.
This could perhaps be the reason why this industry hasn’t really seen anyone stay over a long time. Players have come and gone, and more keep entering in the hope of figuring out that magical formula. One that I can recall is of Karigar.com.pk, which basically does (or did?) the same usual repair services. As per a Facebook post on its page, their app was live at least two years ago and at the time of writing this article had only 100+ downloads. Apparently they do have a decent presence in the B2B segment but those are quite different dynamics compared to a consumer business eyeing at the mass market.
“Model leakages are always going to be there, irrespective of the industry. Even the beautician at a parlour offers the same service at home, thus bypassing their employer. The only way to contain is by making sure your supply gets more orders through you than they would on their own, while the users should be lured with after-sales services, better price and other loyalty programmes,” says Umair.
Not to say all have met the same fate. Supertasker seems to be doing alright, at least for now, with its “get anything done” offering. To Sukoon, it perhaps doesn’t matter anymore but the startup does serve as an interesting case study for those working on their own products.
The writer is member of staff:
Published in Dawn, January 26th, 2020