Ever since the exit of founder Rahul Yadav last year, the online real-estate startup Housing has been through numerous ups and downs. Multiple reports had recently suggested that Housing was actively looking to score more funds to keep operations alive. But, it now seems that the company is getting in bed with the most-active real estate platform ‘PropTiger’.
According to three sources close to the proceedings, Housing.com has struck a partnership deal with Gurgaon-based PropTiger. This partnership could, as they say, be a first step towards a potential merger between the two online real-estate platforms, reports ETTech.
This partnership arrangement, currently experimental, is aimed at combining Housing’s online reach with PropTiger’s robust and rapidly expanding offline services, such as site-visits, paperwork, negotiations and home loans. This will allow Housing to feature select new projects on its online platform and then employ the offline services to seal transactions with customers. The commercial structure of the same is based on a revenue-share mechanism.
Elaborating on the same, Housing CEO Jason Kothari said,
PropTiger will provide an upfront marketing fee to promote new projects on the Housing platform, and will also share a part of the transaction fee on successful sale of a property.
On the other hand, Dhruv Agarwala, co-founder at PropTiger is excited for this arrangement, but believes that it would take another three to four months to figure out the how this partnership will pan out. The coming months will help both partners to work out synergies and smoothen the contour of the deal to make it work and increase the closure rate of its deals.
The combined solutions will first be launched in big cities such as Mumbai, NCR, Bengaluru and Pune. It is expected to cover about 20-25 new projects in the first phase. This partnership will help Housing step foot and move ahead with its plan to shift away from a mere ‘real-estate listing platform’ and become a ;complete buy-and-sell platform’
Both the chief execs have denied to comment on the possibility of a merger, or an investment grant from PropTiger’s biggest shareholder and investor, NewsCorp, who now holds a 30 percent stake. The sources says that the deal is currently in early stages, and both partners are discussing the complications that might arise in the liquidation preference.
What is likely to make the deal process more complicated is the liquidation preference and anti-dilution rights held by SoftBank and the stake of the 12 co-founders in the entity. [But], if the merger goes through both News Corp and SoftBank will invest in the new entity,
said one of the sources.
Real-estate startup Housing was started by a group of 12 IIT-B alums in 2012, and soon became the biggest home search portal online. It was last valued at about $225 million, when it raised a fresh $90 million(plus an additional $15 million grant) from its biggest backer and stakeholder SoftBank. It also counts Nexus Venture Partners and Helion Venture Partners as one of its major investors. But, one cannot put a finger on the correct valuation of internet companies in the current downfall of the startup ecosystem.
PropTiger, on the other hand, has recently emerged at the newest competitor in the online real-estate business. It is currently the only real-estate startup that has the capacity to scale and produce profits, while executing transactions. With the fresh funds infused by NewsCorp, the company has gone all out and started a acquisition spree. It has recently acquired PropRates, a startup that collects real estate transaction data and 3DPhy, a Gurgaon-based virtual reality startup to enable both builders and brokers to show real estate properties through mobiles, laptops, or head mounted devices.
It had also acquired rival real estate listing platform Makaan.com in April 2015, to build out is own platform and create a truly comprehensive online real estate ecosystem.
