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241555_10150252494628453_2960211_oThumbtack has raised $12.5 million to grow its marketplace of local services. The startup wants to make hiring a professional as easy as online shopping by providing a comprehensive directory, estimated costs and ratings, and one-click checkout.

Right now the process of finding a plumber, a personal trainer, or a wedding photographer is inconvenient. Sites like Angie’s List, Yelp, and Craigslist provide listings and reviews, but they do not improve the actual booking process.

On Thumbtack, you start by answering a few questions about your needs. The database contains an extensive inventory of vetted local professionals, and the engine will make multiple matches based on factors like availability, budget, and location and deliver multiple quotes within 24 hours. Consumers then evaluate the prices, reviews, profiles, and more for each option and send a message to book.

Founder Marco Zappacosta said that U.S. consumers spend $670 billion each year on local services, and service professionals spend $80 billion a year on marketing. It is a large market ripe for improvement on both sides.

“We believe that consumers shouldn’t have to spend an afternoon blindly calling a list of phone numbers just to find the right pro,” Zappacosta said in an email. “And service professionals should have a better advertising solution than just buying impressions, clicks, or no-promise subscriptions.”

Thumbtack is succeeding in its efforts. It now works with 250,000 service professionals in all 50 states and is generating $300 million a year in new business opportunities. Local professionals are using the site to grow their business along the lines of Etsy or Zaarly.

Zappacosta founded Thumbtack in 2009 while still in college. He and cofounder Jonathan Swanson saw an opportunity to provide a better solution than listings in this lucrative market and moved into his parent’s basement in Silicon Valley to start building. They raised $1.2 million in 2010 from well-known angel investors, followed by a $4.5 million institutional round in January 2012. Javelin Venture Partners led the round with participation from MHS Capital* and Tim Draper.

Zappacosta has since moved out of the basement and into SoMA office space.

Elite VC firm Sequoia Capital led this round with participation from Javelin Venture Partners, and Sequoia partner Bryan Schreier will join the board. The money will fuel growth and hiring.

Earlier this month, a startup called Porch raised a hefty $6.25 million seed round for its home improvement and repair marketplace. It connects homeowners with personalized professional recommendations for home projects. The company conducted a survey in 2012, which found that 98 percent of homeowners experience pain when searching for a professional to address their home needs.

Porch focuses on home maintenance while Thumbtack’s inventory includes business and legal services, child and pet care, event professionals like DJs and makeup artists, singing lessons and math tutoring, car repair, and personal chef services. The company’s approach is not to focus on one specific vertical but to be the go-to place for any local service you could possibly need.

Photo Credit: Thumbtack

Editor’s note: Mark Sugarman of MHS Capital is also an investor in VentureBeat. See our ethics statement.


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