At a time when its peers are increasing their spending, online classifieds and services platform Quikr India has managed to control its overall spending and lower losses for the financial year 2018-19.
The company has posted a net loss of Rs 230 crore in FY19, marginally lower than the Rs 237 crore loss in the previous year, regulatory filings show. This has come on the back of moderation in spending, which rose by a mere 16% to Rs 437 crore.
Quikr reduced its employee costs for the year ended March 31 to Rs 198 crore from Rs 213 crore in the previous year, mainly as it faced lower salary costs. It also reduced non-operational costs such as advertising, which fell by 37% to Rs 10 crore, and technology costs, which fell by 25% to Rs 9 crore.
Typically, startups tend to indulge in higher spending when it comes to marketing and technology spends. In FY19, Quikr’s profitable rival OLX doubled its total expenditure to Rs 360 crore.
The 16% rise in total expenses for Quikr came from the increase in operational costs such as rental costs, which rose by 59% to Rs 27 crore. Subcontracting costs rose over threefold to Rs 26 crore. Other overall expenses grew 34% to Rs 190 crore in FY19.
Quikr’s compensatory fee expense, which it pays to homeowners on-boarded on the home rental solutions platform, nearly tripled in FY19 to Rs 28 crore.
The company lists home rental properties on its platform on behalf of the owners and provides allied services to landlords and tenants. Quikr assures a minimum monthly rent to property owners and compensates them in case of a shortfall.
Recently, the company reportedly handed pink slips to 500-600 employees from the rental, automobile and jobs classified segments, financial daily Mint reported. The layoffs come on the back of the alleged scam at the company’s real estate product Grabhouse by mid-senior employees who created fake papers for properties that were being on-boarded to the platform, the report said.
Despite the moderation in spending, the company posted a healthy 74% growth in revenue at Rs 191 crore. The company clocked Rs 50 crore from mainstay advertising revenue against Rs 49 crore, while home rental solutions jumped to Rs 85 crore from Rs 8 crore in the previous year.
While other services’ revenue rose to Rs 45 crore from Rs 17 crore, commission revenue fell to Rs 49 crore from Rs 64 crore.
Quikr in December received a $25 million fund infusion from its Mauritius-based parent Quikr Mauritius Holding via equity issue. The Indian unit allotted 1,78,828 shares to the parent entity at Rs 9,871 apiece, separate regulatory filings show.
So far, the company has raised $440 million in various private equity investment rounds, as per data available with VCCEdge.
The Tiger Global Management-backed Quikr counts Swedish firm AB Kinnevik, hedge fund Steadview Capital, Warburg Pincus, venture capital firm Matrix Partners, Nokia Growth Partners, eBay and Omidyar Network among its investors.
Founded in 2008, Quikr began as an online classifieds platform, but expanded into online services aggregator across verticals like real estate, automobile, jobs, furniture and electronics, with a presence in over a thousand cities.