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Urban Company Achieves Profitability Milestone in April 2024, CEO Abhiraj Bhal Announces

• ByStartupStory     |    May 14, 2024

In a recent LinkedIn post, Abhiraj Singh Bhal, the CEO and co-founder of Urban Company, announced a significant milestone for the hyperlocal services startup—the company achieved profitability before tax (PBT) in April 2024. This achievement marks a turning point for Urban Company, whose India operations have now managed to offset losses from its overseas ventures.

Bhal highlighted the journey towards profitability, emphasizing that while the India business had previously attained profitability, investments in international markets had kept the consolidated company in the red. However, with India’s profitability now effectively countering overseas losses, the consolidated business has become profitable at the PBT level.

Urban Company’s overseas footprint includes operations in the UAE, Australia, Singapore, and Saudi Arabia. Despite challenges posed by expansion into these markets, the company’s strategic focus on profitability within its core operations has begun to yield positive results.

Bhal emphasized Urban Company’s commitment to sustainable growth, pledging to prioritize the interests of customers, service partners, employees, and shareholders. This commitment to sustainable growth aligns with a broader industry trend, where startups are under increasing pressure to demonstrate profitability and operational efficiency.

The latest announcement follows Urban Company’s earlier milestone when its India business achieved break-even at an adjusted EBITDA level with negative working capital in the first quarter of fiscal year 2023-24. The company also reported a significant year-on-year decline in net losses for fiscal year 2022-23, demonstrating a 40% reduction compared to the previous year.

Urban Company, founded in 2014 by Bhal, Raghav Chandra, and Varun Khaitan, offers a diverse range of services including home cleaning, appliance repair, salon and massage, painting, and more. The startup has garnered substantial backing from prominent investors such as Tiger Global, Prosus, and Steadview Capital, with total funding exceeding $445 million.

While Urban Company has achieved profitability at the PBT level, the startup aims to continue its trajectory towards sustained profitability and operational excellence. This development coincides with a broader shift in the Indian startup ecosystem, where profitability has emerged as a key metric amidst a challenging funding environment characterized by reduced investor appetite for high-risk ventures.

The trend towards profitability is evidenced by other notable startups in India, including CarTrade, Groww, Fractal, Indifi, and Perfios, all of which turned profitable in fiscal year 2022-23. This shift underscores a strategic imperative for startups to adopt sustainable business models amidst evolving market dynamics and investor preferences.

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