The initial idea Homejoy brought to the table made a lot of sense. People could come to their website where they would connect customers to home service providers in the form of house cleaners and handymen. It was a sensible service and included people in several major cities across the United States, Canada, and even the United Kingdom. Homejoy charged a variable rate, usually between $25 to $35 per hour ($19 introductory rate). However, issues arose as the company began to lose customers. The CEO at the time, Adora Cheung, seemed to avoid working on trying to fix this problem.
[Image via Forbes]However, Homejoy did not ultimately struggle to survive because of this alone. Rather, the company faced four different lawsuits from workers who claimed they were misclassified as contractors. This is an issue because it lies to customers about what they are getting out of someone, which only puts the worker at risk of lawsuits and takes money from them too. Yet it seems that international expansion and leakage of its best workers to direct employment with former clients also hurt their bottom line. As a result of these issues, Homejoy shut down in 2015. Making it one of the many failed Silicon Valley corporations.