Last week, laundromat startup WeClean raised roughly $900,000 in follow-on funding from local and foreign investors—bringing their total funding to $1.2 million—to fuel expansion plans that co-founders Alfonso Bigeriego and Ignacio Phelan claim will position the four-year-old company as the largest fully-owned laundromat player in Metro Manila. Should they succeed, it would be a massive leap forward for a firm that only a year ago was actively shuttering branches affected by rolling community lockdowns.
When the ongoing pandemic first began throttling businesses across Metro Manila, WeClean was among the many firms forced to restrategize. Launched in 2017, WeClean aims to provide affordable, quality laundry services to the roughly 80% of busy Manilenyos that the company says do not own washers and dryers. High demand allowed the company to scale to nine branches across the national capital region—until the pandemic hit.
Phelan, who joined WeClean in May 2020, began his stint as chief operating officer by closing two of those nine branches that were losing money due to quarantine measures. Their relatively larger footprint meant they could then reallocate machines to branches that could use the extra capacity. This was something smaller laundromat outfits couldn’t match.
Noticing this, the team realized their long-term goal of massive growth was suddenly and concretely within reach. Instead of scaling down operations, they could rapidly scale up their business by buying out their struggling competitors.
“That’s when we really started growing again,” said Phelan. “We saw that [competitors] were scared, were panicking. We realized there was an opportunity there to buy competitors and roll those assets under one corporate structure, and then become the biggest laundry player in Metro Manila.”
By the end of May 2020, WeClean added two new locations to their network. By July 2020, they gained another three. By August, four more branches joined the group. Now, following their successful fundraising and pending negotiations for about 30 more locations, they could be ending the year with 57 fully-owned branches.
“Our goal for 2022 is to keep doing what we’ve been doing,” Phelan said. “Leveraging our know-how, our experienced team, our ability to raise funds, to keep buying competitors at low multiples.”
This month, the firm also began allocating resources in earnest towards opening more branches organically. Phelan hopes that by this time next year, they’ll be managing 200 branches, cementing their place as Metro Manila’s leading laundry player, and potentially expanding beyond the capital region.
“We see great opportunities in other major cities in the Philippines,” Phelan said. “We might also be looking to expand to other countries in Southeast Asia, beginning with Vietnam.”