Ikea's been killing it these last few months. The world's largest furniture retailer has been revamping its image from inexpensive furniture maker to the innovative company that designs award-winning flat-pack refugee shelters, hilarious campaigns about iPhones, and tongue-in-cheek responses to luxury brands.
All that was small potatoes compared to Ikea's biggest news of the year so far. Ikea just announced that it acquired TaskRabbit for an undisclosed amount. Around 60,000 "taskers" use the platform to connect with people who need odd jobs done, such as deliveries, household tasks, and constructing Ikea furniture.
TechCrunch reported the startup began looking for a buyer last spring. To date, TaskRabbit has raised $38 million. "All indications are that handyman services, light home renovation, and furniture assembly are going to end up being a billion-dollar business," TechCrunch wrote. Even though we don't yet know how much Ikea paid to acquire TaskRabbit, it's safe to assume it was a mind-boggling amount. The company will continue to operate independently, the New York Times reports.
So what does this mean for the future of both companies? A lot.
Ikea is about to win over way more shoppers
For any business to achieve--and maintain--success, it needs to find a way to make itself invaluable to customers. It appears that Ikea is well on its way to doing that with TaskRabbit.
There are plenty of people who already love Ikea. But there are plenty of people who don't. Shopping at an Ikea store is a relationship death trap. If you haven't tried to assemble a piece of Ikea furniture, you have not understood frustration. Don't even get me started on trying to take it apart.
Sure, the entire process of shopping for, transporting, and putting together a piece of Ikea furniture is cost effective. But that's not appealing to everyone. Or even achievable. Many people who live in urban areas don't have cars, and Ikea's large, sprawling stores are typically in suburbs that are not accessible by public transportation.
Ikea is missing out on a huge portion of the furniture-buying market share: people who can't be bothered with an Allen wrench or who can't get to their stores.
Time is money. And a lot of us don't have a ton of it to spare. In fact, a recent study found that people who spend money to buy back their time (by paying people to do stuff like clean their house or assemble furniture) are far happier than people who buy stuff. With TaskRabbit, you can buy back your time--something that Ikea could never have previously offered.
On TaskRabbit, you can book a tasker who has a car, can shop for you, and can deliver your furniture straight to your door.
You can hire someone to assemble the furniture for you.
Want to move that desk to your new home or donate it to a thrift store? There's a tasker who can take care of that, too.
The TaskRabbit platform opens the door to a huge portion of customers Ikea previously couldn't reach.
Ikea's vision is simple: To create a better everyday life for many people. Their acquisition of TaskRabbit isn't surprising at all. In fact, it plays perfectly with their vision. Now, with Ikea, you can literally buy happiness.
Getting back in the innovation game
For years, Ikea has been known as the sensible, practical Swedish furniture company for everyday people. The company's values include humbleness and cost consciousness.
Billy bookcases and Klippan loveseats have become so commonplace in homes around the world that it's easy to forget how disruptive the concept of flat-pack furniture was when Ikea first brought it to market. Designing flat-packed furniture became integral to Ikea's model early on in the company's history, starting in 1955. Today, a slew of flat-pack furniture design startups have entered the market in attempts to give Ikea a run for their money.
Does that mean that these startups are poised to edge Ikea out of the furniture market? Not necessarily. Not today. But maybe in the future.
Because on its path to achieving total furniture domination--now boasting 400 stores in 28 countries--Ikea has become a giant. We all know that giants have a hard time moving fast and innovating. But startups can.
Enter TaskRabbit, the not-so-little startup that could. Bringing TaskRabbit under the Ikea umbrella is not too terribly risky. TaskRabbit's gig-based platform has proven a solid business model, with overwhelming demand on both sides of the market. They've been around since 2008 and have established success.
Time will tell how this partnership evolves, but one thing's for sure: Don't be surprised if you hear more from Ikea in the future. They're making big moves beyond your first college apartment.