Founder and CEO of Laundryheap, Deyan Dimitrov, reveals how he scaled up his laundry business with no outside investment
Entrepreneur Deyan Dimitrov is a prime example of how sheer hard work, determination and a resilient business model can skyrocket your business to success
“I found it vital to stay focused on our business and not become distracted by what others were doing,” Mr Dimitrov, CEO of Laundryheap tells me. “I constantly reassured myself that our strategy was the right one.” Deyan was born and raised in Bulgaria, living with his two parents and younger brother before moving to the Netherlands to attend university, becoming the first in his family to pursue higher education. He moved to London to study a Master's degree in business management and later worked in the field. A suit and tie were his daily wardrobe choices, and Deyan relied on his local dry cleaners to ensure he looked prim and proper in the office. One day, he brought his suit to be dry cleaned for an important business event the following day but was devastated to find the store was shut. Deyan was left frazzled as he had nothing to wear for the event – and that was when an incredible idea struck him. Just like thousands of employees all over the UK, Deyan realised there was a need for convenient, reliable and fast dry-cleaning services that can be booked with the touch of a phone screen, serving busy workers who don’t have the time to pop down to a laundry shop.
“The idea for Laundryheap came to me one fateful evening,” Deyan tells me. “I was standing outside a closed dry cleaner, with my suit on the other side of the doors. With nothing to wear for an event the following day, I racked my brains for an alternative. It occurred to me then that I certainly wasn't the only person to have been in this situation, and far from the last. So, I set out to form a reliable alternative: an entirely on-demand, door-to-door laundry and dry-cleaning service which can be booked through a website or app. Just a few months later, Laundryheap was born!”
Established in 2014, Laundryheap is a service that collects, cleans and delivers fresh laundry and dry cleaning in just 24 hours. With the simple click of a button, customers can book drivers to arrive at their door to pick up their clothes at a time that is convenient for them – including late evenings and weekends. Laundryheap even has a contactless delivery option so drivers can collect laundry at a safe location without customers needing to be around.
With ever-changing consumer behaviour in food and retail, Deyan realised there was a large gap in the market when it came to laundry sector. Deyan has a vision to create a service that was easily accessible to people and businesses on both a small and wide-scale. “At the time of Laundryheap’s founding, on-demand businesses were cropping up everywhere, but they largely focused on food and transportation,” he explained. “I knew there was a crucial gap in the market for a service that understood how diverse and continually-evolving consumer behaviours were. Laundryheap isn’t just for emergencies, we lend a helping hand to a wide range of customers, who all have their own reasons for using our services. Since launching, our custom now ranges from new parents struggling with their increased laundry load, to large hotel and restaurant chains outsourcing laundry services.”
During the early stages of Laundryheap, Deyan made sure the business was bootstrapped and refused to accept any external funding from investors. He believed in his business model and kept costs low while investing profits straight back into his company. In 2017, they raised £2 million in super angel funding and launched equity crowdfunding via Seedrs that same year, which later raised another million. This helped Laundryheap rapidly grow and expand into international territories. “I decided very early that we would bootstrap Laundryheap before accepting any external funding,” Deyan explained. “This was to ensure that the business was truly sustainable before bringing in external stakeholders. We kept costs as low as possible and poured every penny made back into the business.”
“We managed to stay entirely bootstrapped for three years - a feat I’m really proud of,” Deyan added. “Everyone else in the market was heavily VC backed, so we really had to trust our gut and stick to the strategy. However, the time and energy spent refining our services and working hard to establish and maintain our 24-hour laundry turnaround time - something no other competitor offered - has been instrumental to our success since. We have a stronger, more profitable business model as a result. Once we were confidently on the road to profitability, we raised external funding. In 2017, we raised £2m in super angel funding and launched equity crowdfunding via Seedrs that same year, which later raised another million. It’s helped up turbo-charge growth and execute our recent rapid expansions into international markets.”
Entrepreneurs are often known to take big risks in their career. However, Deyan has applied a rather different approach, something he calls “taking his time”. His business tactic comprises of a rather careful and detail-oriented approach, to enable him the freedom to make bigger risks ahead. “Whilst it’s widely believed that an ability to take big risks makes for a successful entrepreneur, I think that more focus should be placed on the small, careful steps needed to ensure that a business is sustainable and valuable to its customers,” Deyan explained. “The majority of our business comes from repeat custom, and the rapport we have built with our customer-base certainly wasn’t achieved overnight. Taking the time to get things right at the beginning also opens up room for bigger risks down the line.”
As the coronavirus pandemic hit, Laundryheap inevitably experienced a decline in orders – but Deyan never let any obstacles get in his way. Instead, he steered efforts into ensuring customers' needs were met during the pandemic while focusing on steady growth and staying true to his business model. He also included NHS workers discounts and a ‘pay it forward’ scheme to allow users to ‘gift’ their neighbours or loved ones with a Laundryheap service. “We inevitably experienced a decline in orders made but didn’t allow it to dampen our spirits,” Deyan said. “We instead focused our efforts on ensuring our services aligned with what our customers need from us most - like high-heat cleaning services and support for healthcare organisations. Likewise, having spent so long focused on Laundryheap’s steady growth, we were very fortunate to have built a resilient business model that could withstand a period of adversity.”
“We set out to shift our operations in ways that would be of most value to our current and future customers,” Deyan added. “This included an NHS and key worker discount, a ‘pay it forward’ scheme, which allows users to ‘gift’ their neighbours or loved ones with a Laundryheap service, and made the option of a high-heat, virus-targeting wash available to all customers. In addition, at the height of the UK’s toilet roll shortage, we reached out to a number of charities who helped us distribute our surplus of cleaning supplies to care homes and older people across the country.”
In a few words of advice to other SMEs struggling during the coronavirus pandemic, he said: “More than ever, consumer behaviours are rapidly changing, so it’s important for SMEs to embrace change too. The best advice I could give to others is to continually innovate, and tailor services in ways that are most helpful to your audiences. Whether that means maximising your digital presence, or trialling delivery options, find out what your customers need most from you right now. At the same time, don’t panic and make an unnecessary pivot. Trust your gut.”
Even as a busy CEO, Deyan takes time out of his busy schedule and travels to Zurich, Switzerland every Thursday to spend time with his family. “As a CEO, I could very easily work 24/7!", he said, “So it was vitally important to make time for myself and the things that matter most. As Laundryheap is headquartered in London and my family live in Switzerland, I committed to travelling every Thursday to Zurich to spend quality time with my family, which means I can give them my undivided attention. At the same time, it means that when I’m at work I can focus on the business completely.”