There comes a time in every phone’s life when its screen cracks. The are three ways to deal with it: You could live with it, to teach yourself a lesson, you could get in line for a replacement at the Apple Store, or you could call the on-demand screen repair service iCracked. You should probably call iCracked.
iCracked, the Y Combinator company that has quietly built up an empire on repairing broken iPhones and iPads, is launching a way to call someone up on demand to buy your old phones back.
With the new iPhone 5s and 5c out this week, it’s an opportune moment for the 30-person startup from Redwood City. iCracked basically started out of a dorm room at Cal Poly San Luis Obispo where co-founder AJ Forsythe gained a reputation on campus as someone who could fix iPhones on the cheap.
He parlayed that skill into a business that’s on track to do eight figures in revenue this year by selling repair kits and deploying contractors or “iTechs” to fix or buy back devices on the spot. They have more than 400 of these skilled contractors throughout the world.
To date, they’ve had a buyback service where you can mail in your phone. But that business is relatively small with a few thousands devices sent in each month.
But today, they’re launching a way that you can call up someone on-demand in the next few hours to take iPhones or iPads off your hands. Depending on the storage, condition and model of the device, they’ll pay up to a few hundred dollars for the latest iPhones or iPads. It’s available in the San Francisco Bay Area now, but they’ll widen out the reach of the program later on. They’ll expand to Southern California next month, then New York.
The hope is that by lowering barriers, they’ll get many, many more consumers to trade in their phones or tablets for cash.
“The problem with most of the competing buyback programs is the amount of friction it takes to get paid,” said Paul Iliya, the company’s chief commercial officer.
So the way it works is, you go here. You share a little bit about your device — is it an iPhone or iPad? What model is it? How much storage does it have?
Then you fill out your location, and share your contact information. An iTech will later contact you to set up an appointment. They’ll get dispatched in the next few hours, take a few pictures of your device, check the IMEI number (or unique serial number) to make sure it isn’t stolen, then you’ll sign away the device.
The coolest part is that iCracked will hand you a branded debit card carrying the value of the device. The company spent a year working on this because they didn’t want the financial risk of having contractors walk around with hundreds or thousands of dollars in cash. When an iTech accepts a device, they can load the debit card with money on the spot and hand it over.
Then you can use it like a regular debit card from your personal bank by taking out cash at an ATM or buying goods at a store. The whole in-person transaction should take 15 minutes at most.
The new service ties into iCracked’s ambition of being the ‘AAA’ for people’s devices.
“We just want to create this business where no matter you are in the lifecycle of your device, you can call on iCracked for whatever you need, whether that could be repairs, buybacks or warranties,” Iliya said.
iCracked has just taken seed funding from Y Combinator, its affiliated Start Fund, and other angels like Elad Gil and Roger Dickey.
Yes, you can fix that smashed iPhone on demand now. That means no visits to the Apple store, or intensive DIY efforts.
A YC alum called iCracked launched a real-time, iPhone or iPad repair service a little over a month ago.
Think of it like an “Exec” or an “Uber” for your broken iPhone that you can order straight to your door.
With hardly any publicity at all, the service is blowing up: it boosted iCracked’s number of monthly customers by about 250 percent and the company tells me the business is eyeing “eight figures” in revenue for this year. The changes add iCracked to a growing class of startups like Exec, Uber, Zimride’s Lyft, Instacart and Postmates that are all trying to solve the logistical issues of delivering products and services in real-time in urban cities.
“We want to be the ‘AAA’ for your device,” explains AJ Forsythe, the company’s CEO. “We’re doing on-demand repair and buyback for just about every major city in the U.S.”
He shared some of the maps above and below with us, showing actual completed repairs in the last 30 days. Above is the San Francisco Bay Area, and just for good measure to show that this isn’t a Silicon Valley-only phenomenon, he showed us a map of South Florida (below).
“We’re trying to get to a place where we can get someone to them in the shortest amount of time at the click of a button,” he said. He partnered with a 20-year-old from the U.K. named Martin Amps, who had built a dispatch system just months ago. Amps never implemented it because it was so specialized, but Forsythe found him on a Hacker News posting and thought the system could be of use to iCracked.
Up until then, iCracked’s three-prong business model worked similarly. But it didn’t operate in real-time. Customers would have to mail-in their devices or schedule appointments with iTechs.
iCracked earns revenue in three ways: it does 1) repairs, 2) buybacks and 3) sells do-it-yourself kits (pictured right) for people who want to fix phones themselves.
The company has more than 350 “iTechnicians,” who work as contractors and are trained to quickly fix broken iPhones and iPads. They earn decent salaries of between $70,000 and $100,000 a year. Forsythe says he’s selective and he only ends up hiring about 2 to 3 percent of iTech applicants.
While these “iTechs” aren’t full employees of the startup, iCracked earns revenue by selling them parts and connecting them with customers. Depending on whether it’s an iPhone, iPad or iPad and the kind of problem a customer has — whether that’s a screen or battery replacement or water damage — costs hover around $75 to 99. But an iPad LCD replacement can top $200 with the mail-in service. If you don’t spring for Apple Care, iCracked beats the cost of paying for an entirely new device or spending more than $200 on a replacement phone.
The “iTechs” make up about 50 percent of iCracked’s revenues, while 30 percent comes from the DIY kits and the remaining 20 percent comes from buybacks, where the company will pay to take old, unused iPhones or iPods off people.
The new real-time dispatch service will also change the buyback program. Before, iPhone owners would have to mail in their devices, get an appraisal seven to 10 days later and then get a check in the mail after that.
Eventually, iCracked will be able to send out an iTech immediately, who will estimate the value of the device, and then give the customer a prepaid debit card for that amount on the spot, which can be redeemed at any local ATM.
This complex, real-time dispatch system is a far cry from where iCracked started. It’s one of those humble “dorm room” businesses that emerged out of Forsythe’s time as an undergrad at Cal Poly-SLO. He gained a reputation on campus as someone who could quickly fix iPhones on the cheap. He then turned it into a business, and started charging people at school $75 per fix.
Eventually, he started scaling up iCracked by finding makers of inexpensive screens and then hiring and training other people to repair devices. After that, he joined Y Combinator’s winter class of startups last year.
The business has some angel investment, but Forsythe says he’s shied away from doing a full Series A round. They’re starting to look for additional growth capital now, however.
“We have this thing called — ‘hardware,’” he joked, poking fun at how venture investors seem to favor software startups.
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