A home typically represents the single largest asset that individuals or families have. Yet, there has not been much technology devoted to making the management of a home more seamless. Homeownership requires not only financial commitments but a significant investment in time. Humming Homes is on a mission to streamline the experience with technology. It’s an end-to-end home management platform that provides continual access to home service experts, a vetted marketplace of vendors for all home maintenance and renovation needs, as well as a console that provides data-driven insight to get a holistic understanding of your homeownership maintenance needs. The platform is currently servicing “mass-affluent” markets with single-family homes like the Hamptons, Westchester, and Greenwich, with imminent plans for expansion to South Florida, Los Angeles, Scottsdale, Austin, Houston.
AlleyWatch caught up with Humming Homes CEO and Cofounder Adeel Mallick to learn more about the genesis for the business, the company’s strategic plans, latest round of funding, which brings the total funding raised to $8.1M and much, much more.
Who were your investors and how much did you raise?
Humming Homes raised $5.6M in Seed funding led by Ian Sigalow of Greycroft. Follow-on investors AlleyCorp (Kevin Ryan), Sound Ventures, Thrive Capital, New Valley Ventures (Vector Group LTD.), and Abby Levy.
Tell us about the product or service that Humming Homes offers.
Humming Homes has built an end-to-end management solution powered by software for single-family homeowners. With a digital-first experience, dedicated in-person team of home service experts offering a single point of contact, 24/7 live support, and data and insights to avoid reactive & expensive home maintenance issues, the system is designed to overhaul what it means to own and maintain a home.
What inspired the start of Humming Homes?
The genesis of Humming Homes began when I was in business school at MIT Sloan. Beyond the classroom, I spent all my free time exploring the world of real estate technology having worked at Katerra and investing at Sound Ventures and Bessemer Venture Partners. It was those experiences that allowed me to see so much of the category broadly and make meaningful connections to help further all the ideas I initially had.
After being introduced to Kevin Ryan, a serial tech entrepreneur, and his NYC-based venture capital firm AlleyCorp, I started digging into the macro trends around homeownership and the broader home services industry. I found it remarkable that there had been such little innovation in one of the largest categories of household spend. Namely, anything to do with home maintenance and improvement.
I was then introduced to my now-partner Kyle Carnes through a mutual friend, Zann Ali (Principal at 2048 VC). He had just hit his five-year mark at Instacart, having helped scale the rapidly growing company as an operations leader, and was looking for an opportunity to go from 0 to 100 with another offline industry. As we spent more time together exploring the home services market, a clear and massive opportunity began to present itself.
Sadly, Kyle lost his dad around the same time. It was then that the burden of homeownership began to strike a personal chord, as he saw first-hand how hard it was to help his mother maintain their family home in Oregon while sitting 3,000 miles away. He knew that a home management platform was much needed to help her take care of their most expensive asset, and that other homeowners could benefit from the same type of service.
The platform we had been brainstorming was the answer. It became clear to us that a new, innovative approach could radically transform the ownership experience by saving homeowners time and delivering peace of mind.
How is Humming Homes different?
We’re not building a pure-play marketplace, or an extension of “a handyman” – we’re building an end-to-end tech-driven service that is a mix of both in-person and centralized support with people who know your home, and a marketplace that is curated to your needs.
Humming Homes is focused on offering a homeowner-first solution with an initial target customer base of the “mass-affluent” – single-family homes valued greater than $750K and located in dense, desirable home markets such as The Hamptons, Greenwich, Westchester, Miami, Fort Lauderdale, Greater Los Angeles, Scottsdale, and Texas (Austin, Houston, etc.). These homes are inherently complex and the next generation of homeowners needs more than just a band-aid fix or set of inherited vendors to help – and that’s where we want to upend the status quo.
What market does Humming Homes target and how big is it?
According to a recent study by Angi, the home services market represents over $500B in consumer spending. This is a huge opportunity – the average U.S. homeowner spends 1% – 2% of their home’s value on maintenance and improvement annually. Our target demographic, which represents just 10% of all homes in the U.S., spends close to 50% of the entire home services market.
What’s your business model?
- Subscription-based recurring revenue (i.e., access to home management, expertise, vetted vendor marketplace, etc.)
- Managed marketplace of home services (i.e., curated network of local vendors)
What are your post-COVID office plans?
We’ve actually been working out of AlleyCorp’s offices for quite some time (since Feb/March this year) and our setup is a hybrid between remote and in-person. We’re taking COVID precautions seriously, mandating vaccination in order to come to the office, which my cofounders and I generally believe employees want the option to do. That said, we are quite flexible with our hiring strategy (and locations), and we’d be foolish to believe that a remote working culture won’t be part of any tech company moving forward.
What was the funding process like?
The 4-5 months prior to our fundraising cycle were spent maintaining and developing relationships with investors with mutual excitement and understanding of the relevant investment space. Once we were ready to kick things off, we lined up about 25 initial meetings with potential lead investors over a 2 week period. About 3 – 4 weeks into the process of pitching and diligence, we received our first term sheet.
What are the biggest challenges that you faced while raising capital?
The home services space is big and hairy – there is a lot of scar tissue around failed tech-enabled services broadly and home service startups. We have to articulate a vision that respects previous efforts and also identifies a clear-eyed path to successfully navigating the space’s inherent challenges.
What factors about your business led your investors to write the check?
I think those that are familiar with the broader home services space know that most companies have targeted either a vendor marketplace or home warranty add-on angle. We’re flipping that on its head by focusing on aggregating the home – i.e., offering a customer-first product – and using our customer acquisition story to drive engagement on the vendor marketplace (and kick off the flywheel of spend → marketplace → pricing dynamics). That really resonated with Ian at Greycroft because he’s spent a lot of time with operators of other players in the space and was aligned with our vision. Lastly, timeliness – the influx of new homebuyers (changing trends + COVID) has accelerated customer pain points of not having any resources, time, or support for their (now) most expensive asset – their home.
I think those that are familiar with the broader home services space know that most companies have targeted either a vendor marketplace or home warranty add-on angle. We’re flipping that on its head by focusing on aggregating the home – i.e., offering a customer-first product – and using our customer acquisition story to drive engagement on the vendor marketplace (and kick off the flywheel of spend → marketplace → pricing dynamics). That really resonated with Ian at Greycroft because he’s spent a lot of time with operators of other players in the space and was aligned with our vision. Lastly, timeliness – the influx of new homebuyers (changing trends + COVID) has accelerated customer pain points of not having any resources, time, or support for their (now) most expensive asset – their home.
What are the milestones you plan to achieve in the next six months?
We’re laser-focused on (1) signing up more homes in our current markets to show penetration, (2) demonstrating the extensibility of HH by launching our second region in South Florida, and (3) continuing our product development to unlock better consumer experiences and efficiencies on the service delivery side
What advice can you offer companies in New York that do not have a fresh
injection of capital in the bank?
Move fast – if you think you’re moving slow, chances are that you are. However painful it is to realize, the faster you get to a “no” on a thesis, concept, strategy, etc the faster you can get to internal validation of what is going to work and a “yes” from an investor.
Have fun – the highs are super high and the lows are incredibly low. You should definitely be sprinting, but make sure you and the team are taking care of your mental health and enjoying yourselves along the way (our opinion is that frugality is key at an early stage).
Where do you see the company going now over the near term?
Humming Homes has grown rapidly since our launch in October 2020, now operating in neighborhoods across the tri-state (Hamptons, Greenwich, Westchester, etc.) with over half a billion worth of ($500MM) homes under management. We’re focused on expanding locally and launching Florida markets by EOY.
It’s incredible what we’ve been able to build in this short amount of time with the support of Kevin, Ian, and our other investors. We’re excited to be able to hire for some key roles (shameless plug, we’re hiring!) and begin scaling our model.
What’s your favorite outdoor dining restaurant in NYC?
For Breakfast – I’ve really become a big believer in “power” breakfasts to kick off the day. Mostly because of convenience, but also because they have incredible avocado toast, Citizens of Soho and Banter!
For Dinner – Emily in the West Village. My wife and I love the Jerrier pizza & the Emmy burger – just can’t go wrong!
