SoftBank-backed on-demand laundry startup Laundrygo picks up $37M Series C

[ – 2022.11.21] Mom-and-pop stores and franchises — mostly offline — account for about 95% of the laundry market in South Korea, according to Laundrygo CEO Sung-woo Cho. But his South Korea–headquartered startup aims to digitize the laundry industry in the country. How? Through an on-demand mobile app that enables users to place an order to pick up and drop off their laundry and dry cleaning within 24 hours. The outfit also operates laundromats and smart factories to handle washing and drying clothes.

Investors like the idea. Laundrygo said today it has closed a $37 million (49.5 billion KRW) Series C funding round led by private equity firm H&Q Korea, with participation from returning investors SoftBank Ventures, Altos Ventures and Aju IB. New investors such as KB Securities, Hanwha Securities, Badgers Investment and Pebbles Investment and strategic investor Musinsa, a Korean fashion platform, also participated in the round.

According to sources, who wished to remain anonymous because the terms of the deal are confidential, the startup’s post-money valuation is now estimated at $254 million (350 billion KRW), up from $110 million (150 billion KRW) in September of 2021. Laundrygo currently runs three main businesses: laundry pickup and delivery service via the app (Laundrygo), a B2B laundry service for hotels (Laundrygo Business) and the laundromat service (Laundry24).

CEO Seungwoo Cho

The startup also operates a clothes alteration service, LaundryX, and has built its AI-powered laundry screening system, which automatically sorts laundry. Cho told TechCrunch that its laundromat is not just a self-service facility that enables users to wash and dry their clothes using washing machines and tumble dryers but also has a contactless dry-cleaning machine in the laundromat space that consumers can also use.

Laundrygo also has plans to expand geographically. While it just opened its 100th laundromat in South Korea, it intends to open its first laundromat, Laundry24, in New York as early as next year. It is also weighing a move into Japan. Indeed, Cho sees vast opportunity with the global online on-demand laundry market projected to reach $128.5 billion by 2026, up from $18.7 billion in 2019, per a research report.

As for right now, according to Cho, Laundrygo reached 4.4 billion won ($3.3 million) in sales in October, which he said is more than 20 times the revenue the company saw a year ago. He said that overall, the company, which has more than 130,000 registered users in South Korea and more than 500 employees, has tripled its annual sales since 2021.

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