Shortly after her dog was hit by a car and killed, Liz Giorgi was contacted by the business under whose care the dog died.
The company wanted to cover the cost of cremating Giorgi’s dog, a four-year-old Border collie-Aussie-Great Pyrenees mix named Fran who “got away” from her sitter in January, while Giorgi was thousands of miles from home.
The offer seemed painfully inadequate to the startup founder, who had spent days cajoling the company to do something to bring her “soul dog” home alive. Fran was found dead eight days later, and to add insult to injury, Wag’s work to bring Fran home came with a nondisclosure agreement, Giorgi said.
Two months later, Giorgi is still grieving the loss of Fran. And Wag, the online dog-walking and dog-sitting service that lost Fran and other dogs, is preparing for a $350 million
deal that will make Wag a publicly listed company.
The SPAC deal marks an important milestone for Wag, a seven-year-old San Francisco startup that brings the gig-economy worker model of Uber and Lyft to the highly fragmented and localized pet-sitting market. Wag’s app lets pet owners anywhere in the US arrange for someone to walk their dog or take care of their pet while they’re away.
According to the company, Wag booked over 1.2 million pets — mainly dogs — for walks, overnight visits, and other services last year. The app-based platform provides an easy and affordable way for busy pet owners to care for their dogs, while creating new money-earning opportunities for gig workers. The injection of cash Wag gets in the SPAC deal will pave the way for big growth: Wag predicts it will nearly quintuple gross bookings from 2020 to 2023 and expand to other services, like pet wellness. Based on these big growth plans, Wag predicts $71 million in revenue in 2023 — up from $20 million last year.
Despite the ballooning revenue, which nearly doubled from 2020 to 2021, Wag cut support staff last year, spending $3 million less on the team in 2021 than in 2020. Customers felt the effects: Wag noted in its filing to go public that layoffs created “substantial delays” in customer support.
Caring for animals is an inherently risky business, and problems with Wag and competitors like Rover aren’t new — a 2019 CNN feature, among other stories, highlighted Wag’s stumbles. But Wag’s policies and systems involving pet safety and customer response could come under renewed scrutiny as the company makes its Wall Street debut. Wag has offered no specific plans about reinforcing its trust and safety team — something that several customers and company insiders say is sorely needed.
Three former employees in Wag’s “trust and safety” department said they won’t use Wag for their own animals. Support teams regularly take a day or longer to respond to emergencies, including a dog walker who called about a bleeding dog in November.
Wag spokeswoman Rachel Carr would not make executives available for interviews and she declined to answer a detailed list of questions about the company’s trust and safety processes. In a statement, the company said Fran’s caregiver was suspended pending an investigation.
“We were deeply saddened by Fran’s passing and our hearts go out to her family. Safety is a top priority at Wag and every service is insured and backed by the full support of our Trust and Safety team,” the statement reads.
Untrainable gig workers and no safety reports
Because neither Wag nor Rover release safety reports or any related statistics, and no government or independent group collects such numbers, it’s impossible to know how many animals have been injured or died under the companies’ care.
The S-4 filing for Wag’s SPAC deal provides scant data about such incidents, other than flagging it as a risk factor that could potentially impair the value of the stock. The company is a defendant on “a number of matters related to accidents or other incidents,” it said in its filing to go public.
“Wag has incurred expenses to settle personal injury claims … and it expects that such expenses will continue to increase as its business grows and it faces increasing public scrutiny,” the filing says.
The reticence to share data is in keeping with other so-called sharing economy services, such as Uber and Airbnb, which are loath to publicize negative data. Uber did not publish its first safety report until 2019, spurred by headlines about sexual assault and other issues, while Lyft sent its first report out in October.
Ride-hailing and dog-walking companies share another common thread: Their marketplace models rely on hundreds of thousands of contract workers, who by definition can’t undergo training or certification beyond basics like a driver’s license. If a driver gets their license revoked, they’re automatically disqualified from ride-hailing platforms, but there’s no equivalent for dog walkers.
Wag has 75 full-time employees, including 22 in customer support, as of December, but the company operates in 4,600 markets. The company relies on a cadre of 400,000 US independent contractors, who take a basic quiz and pass a background check to start watching animals. That number could grow fast as Wag eyes international expansion — peer Rover already operates in 10 countries.
Because these walkers are contractors, Wag and the rest of its gig-economy peers, like Uber, can’t require training. But unlike unhappy ride-share customers who can give a driver a poor rating or write a negative review, dogs can’t give much feedback about their experience with Wag, unless the animals come home visibly injured.
In most states, pets are legally considered property, so humans have little recourse to sue for much more than the cost of the dog. For a shelter mutt, that could amount to just a few dollars. Humans have better luck recouping losses on damaged homes, which Wag touts it insures for up to $1 million.
Some grieving pet parents have sued, and one pair successfully overrode Wag’s mandatory arbitration agreement. Wag now faces a jury trial next year over the 2019 death of Burger, an elderly French bulldog who died after being hit by a car 15 minutes into his daytime Wag walk. Burger’s owners collected video evidence showing his Wag walker on her phone, the dog trailing feet behind her in busy Manhattan crosswalks.
‘One dog lost per day’
Some of the gig workers who walk dogs through the Wag platform say the company’s policies put them at risk, too.
One current Wag walker in New York, who spoke on the condition of anonymity because of fear of retribution from the company, told Insider she couldn’t cancel a walk in early winter for a dog whose walker notes — accessible only after she took the job — said the dog bit. If the walker canceled, she’d get a three-day ban.
“I show up, the dog bites me on the hand in full view of the owner, who says she never does this. I’m thinking, ‘Yes she does, I looked at a page of notes that says she does this,'” the walker said.
Though the dog drew blood, the walker completed the walk, then called customer support. On the app, she couldn’t block the dog’s owner from requesting another walk. While the walker was on the phone to report the dog bite, the owner sent a request for another walk.
“It would be funny if my hand wasn’t bleeding,” the walker said.
Three days later, she was still asking customer support to block the pet parent, who had sent her subsequent walk requests. The walker turned down the jobs for her safety, causing her rating to decrease.
“I don’t know if they don’t have the manpower or they just don’t care. Something needs to be changed,” she said.
Robyn Pell, who uses they/them pronouns, started walking for Wag in 2017 before an unnerving incident in November led them to leave the platform. They returned from walking some of a Virginia family’s dogs to find another with a bleeding paw after its toenail came off. The pet parent didn’t list an emergency contact, and when Pell tried Wag’s emergency button, the help page crashed. When they eventually got through, a Wag representative said someone would call back. Pell never heard back and couldn’t connect with Wag again.
Fortunately, a neighbor randomly popped by and offered to care for the bloody dog.
“I know how to stop the bleeding and to keep the dog from running around,” Pell, who’s worked with dogs for years, said. “I’ve encountered other Wag walkers who are 19-year-old kids and they won’t know what to do.”
Former employees told Insider that when incidents occurred, they were instructed not to apologize, because an apology would indicate Wag’s legal culpability. Instead, they could empathize, and they had set amounts they could pay out for various problem tiers.
One former employee said during their tenure — about two years ago — walkers reported an average of one dog lost per day, most of which would be found within the hour. Huskies were notorious escape artists. But other issues, like refunds for property damaged by Wag walkers or dogs, dragged on for months.
“Most people would just give up because it wasn’t worth their effort anymore,” said the ex-employee. “That seemed very strategic for the company — make it so difficult to get through the process that people would give up.”
Bites and blood: the cost of doing business
As Wag eyes the public markets, analyst Robert Mollins said investors — which include Battery Ventures, ACME Capital, General Catalyst, and Tenaya Capital — are focused on growth. He said investors likely won’t be spooked by negative Wag headlines, unless they’re drastic, like a celebrity’s dog dying.
Wag’s investors declined to comment or did not respond to requests for comment.
“It really is just a cost of doing business,” said Mollins, who works for Gordon Haskett. “It’s like getting in a car with Lyft. Accidents happen. But with animals it’s a little different. Most people treat it as a family member — it’s like your kid got smacked in the face.”
Mollins said he prefers Rover over Wag for the safety of his own three animals. Rover allows pet parents to meet caregivers before sittings, and caregivers set their own rates, two features Mollins said also advantage Rover for growth. Wag, by contrast, takes 60% of the set rate pet parents pay.
As with ride-sharing, food-delivery, and other smartphone-enabled services, the pet sitting and walking services have proved popular with investors and consumers, who have been trained to expect instant — and cheap — work, much of which is subsidized by investors.
Uber investor SoftBank poured $300 million in Wag in early 2018 and installed Hilary Schneider as CEO. But the Japanese investor soured on Wag, selling its stake nearly two years later, and Schneider exited after a bumpy run. Garrett Smallwood, formerly the company’s vice president of product, partnerships, and corporate development, took over as CEO at 29 years old.
Smallwood runs a different ship than his predecessor. The company has shrunk from nearly 450 employees to 75, and its valuation plummeted from a high of $650 million (when SoftBank invested) to $350 million in its current SPAC deal. Smallwood’s chief operating officer oversees trust and safety, while under Schneider, the head of trust and safety reported directly to the CEO.
A former employee highlighted that among Wag’s current eight C-suite executives, none are women and just three mention their dogs in their bios. By contrast, Rover’s executive team has a female chief financial officer, and all of 16 of its executives are featured with pets.
‘Shut up and disappear’
Giorgi says she has received no apology from the company for Fran’s death, despite publicly asking the CEO to make one.
And while Wag touts 24/7 support, Giorgi said the company’s response was woefully inconsistent and lacking urgency during the weeklong crisis when her dog was missing.
After her Wag sitter alerted her that Fran went missing, Giorgi filled out a form — she couldn’t contact anyone live. In an email a full day later, a Wag representative said they were getting up to speed on the situation and they would call Giorgi’s emergency contact, which the walker had already done.
While Wag said in a statement that it “worked diligently” to find Fran, Giorgi disputes that characterization. Five days after Fran’s disappearance — including nights that plummeted to zero degrees in Denver — Wag brought in a dog tracker, who worked with Giorgi’s tracker. In exchange for covering the search costs, Wag directed Giorgi to sign an agreement that released the company from any claims and included a non-disparagement clause.
The trackers suspected Fran was hiding in a nearby park.
Eight days after Fran’s disappearance, she was hit by a car in that park’s parking lot and died.
Giorgi compared Wag’s response to another traumatic incident several years ago, when the CEO of a hospital system called her family weekly following the mid-treatment death of a family member.
“There is a playbook here for how you handle a crisis, and it’s not shut up and disappear,” Giorgi said.
Giorgi is weighing legal options, and said she’s heard from other pet parents whose dogs were injured or died under Wag contractors’ care.
“This isn’t about revenge. It’s about safeguarding other human beings from the grief and tumult that my family has gone through because of a complete and total disregard for life,” Giorgi said. “This is why I won’t shut the hell up — I don’t need $200.”
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