When handymen repeatedly failed to show up for household repairs, this homeowner got even.
In 1995, Bill Oesterle and family bought a house in Columbus Ohio — an old house that needed lots of renovation. And whenever contractors failed to show up for work, it caused them endless frustration.
The apparent lack of reliable workers got him thinking. Instead of walking up and down the street, asking neighbors about competent tradespeople, Oesterle was inspired to start something new: a paid-membership service that would use shared knowledge and membership reviews to rate and recommend contractors.
Enter 22-year-old Angie Hicks, a former business intern for Oesterle.
Hicks and Oesterle formed a partnership, with Angie doing the meat and potatoes work and Oesterle – a venture capitalist — organizing the business.
Angie worked the phone by day and the pavement evenings, going door-to-door to sign up members and get recommendations. It was tough stuff for a naturally shy person, but Oesterle’s pep talks encouraged her to carry on. And after one year — and a few tears — she’d signed up 1,000 members.
Angie’s List was off and running.
At first, it was a phone-in service called “Columbus Neighbors,” where members called in to get recommendations. By 1999, with the rise of the internet, it developed an online strategy to capture what the New York Times called local “word of mouth wisdom.”
Early on, Angie’s List charged a $51 subscription charge. But as more members, and more like-minded websites came online, Angie’s List adjusted pricing to be more competitive. Today the service has nearly 2-million subscribers, with varying membership fees, depending on the subscriber’s location. New York City residents, for example pay about $3.60 a month. Nationwide fees average $32 a year.
The company rates local service providers in more than 550 categories, including roofing, plumbing, remodeling, auto repairs and health care. When users log on and designate their hometown, they immediately see Angie’s List for their community. Members rate providers using an A through F rating scale for price, quality, responsiveness, punctuality, professionalism and overall experience. They also post comments.
Today, Angie’s List is the Grandaddy – or is that, Grandmommy? — of online ratings and recommendations services. And after 24 years it remains strong, in part because it stays current with technology, with mobile apps and recently added Square payment technology to help approved Angie’s List merchants — plumbers, carpenters, housecleaners and painters — more easily accept payments while working in the field.
With 400 employees, $60 million in revenue, 40,000 reviews a month, service in 200 cities, and an investor valuation of $3.6 billion, Angie’s List is a bona-fide online success. (Cash flow is expected to turn positive in 2014.)
Angie Hicks and Bill Oesterle exemplify an Axiom featured on our website: Think around your frustration.
They developed Angie’s List, a membership-only, word-of-mouth ratings service to recommend contractors and household service providers.
Now Why Didn’t I Think of That?