Instant househelp startups burn $16-17 million in June as battle for customers intensifies

Cash burn across the rapidly growing instant househelp sector rose 14% month-on-month (MoM) to $16-17 million in June, according to industry executives, as competition for customers intensified. In May, the combined cash burn of Urban Company’s InstaHelp, Snabbit, and Pronto stood at $14-15 million. The higher spending helped revive demand, which had sputtered in May, the executives said.

Cash burn refers to the amount of money a startup spends — in excess of its revenues — over a given period to fund its operations.

Total orders across the three platforms grew 20% MoM to 3.97 million in June, with Snabbit clocking 1.51 million bookings, marginally overtaking market leader InstaHelp, which had 1.5 million. Pronto recorded 960,000 bookings.


In terms of app usage, Urban Company's monthly active users stood at 6.7 million in May per a Morgan Stanley report, compared to 3.8 million for Pronto and 1.4 million for Snabbit.

By net transaction value (NTV) — calculated as orders multiplied by the post-discount average order value (AOV) — Urban Company retained its lead with 45-46% market share, aided by its higher AOVs. Snabbit followed with 36-37%, while Pronto, with the lowest AOV, accounted for 16-17%, according to industry insiders.

They attributed the June growth largely to aggressive discounting and customer acquisition offers. Snabbit offered three bookings for Rs 99, while InstaHelp ran Re 1 trial bookings in select Mumbai neighbourhoods and introduced a three-visit pack priced at Rs 149. Its standard hourly plan is priced at Rs 79.

“These are limited-time initiatives designed to introduce first-time users to the platform in select micro-markets, and form a small part of our overall customer acquisition strategy,” a Snabbit spokesperson said.

But the discounting weighed on the AOV. According to people familiar with the matter, InstaHelp's AOV declined to Rs 110-115 in June from Rs 140-150 in May. Snabbit's fell to Rs 90-95 from Rs 120-130, while Pronto's dropped to Rs 65-70 from Rs 100-110.

Urban Company did not respond to ET's queries. A Pronto spokesperson said the company, which offers packs priced at Rs 25 for 30 minutes of service and Rs 49 for an hour, posted an AOV of around Rs 100 in June while keeping its monthly cash burn below $3 million. Snabbit said its AOV for the April-June quarter exceeded Rs 130.

“Urban Company's AOV has come under pressure as it has had to respond to the aggressive discounting triggered by Snabbit and Pronto, which have been selling packs for as little as Rs 25 for 30 minutes,” a senior industry executive said. “Pronto is even offering utensil and bathroom cleaning services for Rs 15.”

The sector's rising cash burn, coupled with the relatively limited size of the addressable market, is beginning to concern investors tracking the space. The category is economically viable primarily in urban catchments, where high-order density supports efficient fulfilment and worker utilisation. Expanding into lower-density neighbourhoods is significantly more challenging, an industry executive said on condition of anonymity.

“The instant househelp category appears attractive, but the annual total addressable market across India's top 15 cities is around Rs 3,000-4,000 crore. This estimate assumes 8-12 million addressable urban households, with roughly half using the service three times a month at an AOV of Rs 250-300. Also, current market pricing appears to be below levels that would support sustainable unit economics, suggesting prices are likely to rise over time, which could moderate demand,” the executive added.

For now, companies are focussed on expanding the market by adding new categories. Snabbit has launched Blush, a beauty service, along with home-cook services, while Pronto has introduced car-washing in markets such as Gurugram.

The expansion is bankrolled by serious VC monies. Snabbit has raised $112 million from investors like Susquehanna Venture Capital, Unicorn Growth Fund, Bertelsmann India Investments, and Lightspeed Venture Partners. Its latest round in March valued the startup at $350 million, nearly double its $180 million valuation in October.

Pronto has raised about $58 million from Epiq Capital, General Catalyst, Bain Capital Ventures, and tech investor Lachy Groom. Its latest funding round in May doubled its valuation to $200 million from $100 million in March.