Posted: November 26th, 2017
By: Maureen Gallagher *| Staff Writer
The apps are at it again, and they are out for your money – the money you throw at your dogs that is. Styled as Ubers for dog walking and sitting, startups like Wag! and Rover provide a convenient platform to facilitate the exchange of cash between dog watcher and dog owner, all for a nice commission. Sensing a lucrative area ripe for development, venture capitalists have “poured more than $200 million into Wag and Rover combined.” Wag! promises “on-demand access to experienced dog handlers in your community you can hire for dog walking, dog sitting, or dog boarding 7-days a week.” Dog owners can track their dog’s walk via GPS and receive a report card and photo for the average price of $20 a walk.
Wag! dog walkers and sitters operate as independent contractors, allowing each walker to supplement their income after getting a background check and creating a personal profile. The app looks like Uber, works like Uber, and has big dreams like Uber – at only three years old, Wag! is looking to raise at least $100 million to fund its expansion. Just as Uber upended the taxi industry and Airbnb disrupted the hotel industry, these apps are trying to revolutionize the ask-your-neighbor industry. But dog-walking apps have a much higher hurdle to clear – dog walkers are trusted with an owner’s best friend, so any mishaps can create an enormous risk for these new startups when trying to secure funding and stay afloat.
Wag! recently suffered from a lost dog incident, where a walker lost a Beagle-Labrador mix named Buddy. Even though Buddy was eventually found, “damage to the startup’s reputation was already spooking potential investors.” While the incident was a scary one, the company’s strange response drew even more scrutiny. The company lawyer “fired off a cease and desist letter” to Buddy’s owner, demanding the owner apologize and retract all complaints on social media or else Wag! would “use all available means to bring as swift as possible an end to [his] lies.” In addition to frequent PR disasters, technology service-provider startups like Wag! often suffer from a series of other problems, including “regulatory scrutiny, complaints about shoddy service provided by people they don’t directly employ, high marketing costs and heavy losses.”
Rover is also feeling the startup heat. The Seattle-based startup, which has raised about $156 million, is using some of its funds to hire new employees in the legal and business department to tackle legislation issues. Rover currently has to “fight more than a dozen city and state regulators who claim its pet sitters operate as unlicensed kennels and are illegal.” In the midst of these and other startup troubles, companies like Rover must also forecast demand for dog walking services, since such services, historically, go unreported due to reliance on neighbors and friends to fill the void in a dog’s day. These doggie startups are hoping that demand is bigger than it seems and that they can eventually break the “trust barrier” that makes these apps riskier than ride-hailing or apartment sharing. Time, trial and error, and trust will determine which of the many apps on the market will rise to the top of the dogpile.
Maureen Gallagher is a second-year law student at Wake Forest University School of Law. Prior to law school, she worked for two years for Citi Private Bank as an analyst in the ultra-high net worth group. She holds a Bachelor of Business Administration in Marketing and a Bachelor of Arts in Hispanic Studies from The University of Texas at Austin.