May 7th, 2012

Cherry and the Service Layer of the Web

Back in December, Christina Cacioppo wrote this great post called “Cherry is fascinating and grocery stores belong on second floors” and I read it and thought “Christina is brilliant and sees the future, but I still don’t get Cherry.” But in the five months that have passed since she first posted about it, I have come around.

Cherry *IS* fascinating.

For those unfamiliar, Cherry is a come-to-you car wash mobile app. The app marks your location and you send in a request. $30 later and your car is washed for you, tip included.

While what the business does is pretty cool (for all you car lovers), I think what it represents is actually more interesting. To me, Cherry has become the poster child for the Service Layer of the web. This “service-layer” exists above the application layer, and powers the person-to-person economy that has been growing slowly and is about to explode. How do I know it is going to explode? Just watch the money — Fiverr (announced last week), TaskRabbit, Zaarly, and Uber have all raised eight-figure venture rounds in the past 12 months. To me it’s a bit reminiscent of the mid-2000s social-networking boom, when everyone seemed to know that one was going to explode but it was unclear exactly which one.

While Cherry might not become the largest of these service-layer businesses, it is my favorite because of its elegance and simplicity. It does one thing in a large market really, really well (car wash market is $6b according to quick Google search).

What’s interesting is that I am not sure a business like this would have worked even as recently as 2009. Smart phones are getting faster and easier to use and as a result, these service-oriented businesses will have a much easier time getting to critical mass.

Additionally, the underplayed aspect of all these businesses is that the require pretty significant behavior change. It took *years* for ebay and craigslist to really take off because there was such an understanding gap about how the platforms could be used. Some of the more generalist platforms like TaskRabbit and Zaarly might run into this problem, but Cherry will likely not because it is so specific.

Although these service businesses will be harder to scale because of the very arduous and potentially messy offline component, that is exactly why they present huge opportunities.

Ultimately, there are incredible inefficiencies in the offline distribution of human capital. That is something we learned the first time around with the massive growth of web businesses, and something that we are going to learn all over again with mobile.

Now, if only they would come to Brooklyn and wash my car.

please enjoy this photo of a sudsy kuwait-based lambo (via googs).