'There is too much capital flying around': IndiaHomes founder Samarjit Singh
IndiaHomes.com, owned and operated by Gurgaon-based India World Technologies Pvt Ltd, is one of the leading real estate search and booking portals in India. Unlike most property listing ventures, which tend to be dominated by property listings, IndiaHomes is a broker using cloud telephony besides offline assistance for selling property. The firm has an army of in-house brokers in 11 cities and also owns proprietary Lead Preview System which sells leads to channel partners or agents for a fee in 50 cities.
The firm, which had attracted funding from New Enterprise Associates (NEA), Helion Venture Partners and Foundation Capital, is now on the verge of closing another round and acquiring a couple of startups. Techcircle.in spoke to IndiaHomes' founder Samarjit Singh to know more about the milestones achieved by the company, acquisition plans and more. Here are the edited excerpts:
What was the aim behind the acquisition of Unesta?
We have acquired the company in an all cash deal for $2 million. We acquired it as we wanted to pump up our international presence mainly in places like Dubai, Singapore, London and the US. Because of their vast experience, we find that we will be in a better position to tap NRI market. The acquisition is strategically very important for us as all our NRI customers will now be serviced through Unesta. Handling these clients remotely (from India) is very difficult. In the next few months we believe that 30 per cent of our business flow will come from international market. Presently, NRIs contribute 4 per cent of our business.
Are there any other initiatives to tap the NRI market?
There is a whole event calendar that is rolled out in Dubai and the UK which is going to be attended by NRIs. Most of these are in partnerships with leading developers. Joint marketing initiative is a significant part of what we are looking to do. All these will be done through Unesta.
You seem to be acquiring a few more startups. What is your philosophy?
These are mainly adjacent acquisitions; this means that they are not in space we are operating in. For instance, we are looking at call centre technology acquisition which will help us overcome the language and accent barrier as we strengthen our presence among NRI customers. For Indians, the user experience for customers has become very important and we realised that leading international property portals are much simpler in the way they are designed. So we are also acquiring design studio that can bring world level expertise on IndiaHomes's platforms across screens.
We will buy assets that are complementary to our game plan and do not increase our revenues through acquisitions.
Are you in talks with Vitruvian Technologies and favista.com?
We are not in a position to talk about specific acquisitions.
After the previous round of funding, you employed Lead Preview System to expand to more cities. Can you share details on the fresh milestones achieved with this?
Lead Preview System or LPS, which enables a voice clip of a caller to be sent directly to a validated broker, is very successful and helped us expand to multiple cities. The system is unique as it is a free to list model and brokers/developers pay only for lead, just like Google Adwords where advertisers pay only per click and not imprint.
Within five months of employing this, we have been able to become active in 50 cities from the previous 11 and get 13,900 brokers on board. We continue to add 350 brokers every month. Our traffic has multiplied 5X to 1.3 million unique visitors per month with a conversion rate of 61 per cent.
Most of your leads are tele-based and there are no classifieds. How does it work?
The customers come through the website and then the transition happens to cloud telephony through our partner Ozonetel. This system in conjunction with our call centre patches them out to our field agent who helps them to complete the transaction.
Do you think you are missing on the opportunity to leverage smartphone users?
Our current website is also designed for the mobile interface. We will launch our mobile app in a week. It has many app-only features like 'get help now' button which is a real estate SOS button to get connected to a property counsellor.
What is your reach?
We are present in 50 cities of the country which covers 85 per cent of transaction value. We want to strengthen our presence in these regions before expanding to other cities. We only deal in plots and residential property.
How are you expanding your revenue stream?
We have just launched our ad sales business for developers to advertise launches of new projects. We will close Rs 2-3 crore this financial year in ad sales.
What is your gross revenue?
We hope to close the financial year with $1 billion in transaction value and Rs 90 crore in net commission.
You have raised $24 million so far. How about fresh funding?
We will announce soon.
There are many other companies like Housing, 99Acres in this space. How tough is the competition?
It will be very easy to say that it's not competitive. But the truth is that there is too much capital flying around. I don't know if there is enough wisdom in our industry to absorb so much capital without destroying value which can give the sector a bad name. Some of the companies are not mature enough. Unlike ecommerce, which has high gross transaction values selling billions of merchandise, online real estate industry is not selling that much. I think, there are just one or two competitors and the rest is just noise.
(Edited by Joby Puthuparampil Johnson)