Don't count Commonfloor as competition, says Housing.com's Advitiya Sharma

Housing.com has been in the centre of controversies but that does not deter Advitiya Sharma, co-founder and board member, Housing.com. In an interview with Business Today, Sharma speaks about what differentiates Housing from other real estate online portals and the upcoming battles to be won in this sector.

BT: The spate of controversies... has the image of Housing taken a beating?

Sharma: What has happened has happened. We are focusing on building the product. We have many other battles to win.

BT: It is now a well-known story, but can you tell us again how Housing came about?

Sharma: I remember it clearly. It was Feb 2012, my final semester at IIT Bombay. We realised that from now onwards, we would have to worry about searching for a place to stay every 11 months. We started off pretty early, but realised within a few days that it was going to be a nightmare. It took us 50-60 frustrating days, roaming all over the city, trying to find something that met our requirements. Although we did find something that we liked, the only thought that kept on coming back to us was that this problem has existed for a very long time now and it clearly affects a lot of people. At that point of time, we had this germ of an idea that maybe we could do something about this problem. Maybe we could use our passion for technology and solve this problem. This germ of an idea has now become housing.com

BT: Is search is your primary product?

Sharma: Search is our primary product, but we have also started transacting online. We have built our Slice view technology and till now we have done more than 30 campaigns across the last three to four months. We have run campaigns for Tata Value Homes (started in November 2014), Janapriya, Hiranandani and DLF. Developers who have tried all the conventional ways of marketing, or television and radio marketing, don't find it working. These ads serve only for general visibility; they don't show all the details of the property.

BT: So housing makes no money through search?

Sharma: We do make money from search. We follow a dual model. Categories like land, rental, resale and PG follow a search-based model wherein we charge a subscription fee for listing. We don't do banner adds at all like other portals. Our strength is on data collection which brokers or land owners appreciate: having someone come to the place, get all the property details, click pictures etc and cross-check the details before it goes live.

For new projects which are under construction, through our Slice View technology we are able to get people to book houses online. This is one of the biggest areas where we are transacting online. Besides that, the remaining spectrum is search.

BT: You are also getting in other modes of generating revenue like online rental agreements, home loans etc.?

Sharma: Revenue is at the end of the day a by-product. For home loans, we have partnered with banks. Home loans is a Rs 20,000-crore monthly market. Out of 28 players that dominate this space, we have around 20 on our platform in just four months. Companies like BankBazaar are like a comparison tool of different banks' fixed rates. Our system has created a rule engine which takes a few details on the customer's requirements and throws the best rates for them.

Every month, close to a million houses go on rent in India. Saving people the time and effort required to sign rental agreements is a big time save. We started the product in Bangalore a few months back. In the next few weeks we will be scaling it up to the top 10 markets in the country. We have been working with the registration offices of the government to get this in place. Customers will fill in all details, generate an online rental agreement, will be able to do a digital signature and calculate their e-stamp duty accurately. We already have data collectors who roam around the city taking details and photographs of the houses. We will use them to get the rent documents stamped and approved from the registration offices and deliver at the doorstep within 24 to 48 hours.

BT: You are less than three years in business. Who are the companies you see as close competitors?

Sharma: Housing is solving a very different problem as opposed to 99Acres or Magicbricks. We show people houses. Commonfloor is one who we don't even count as competition. Competition hasn't even scratched the surface in the last seven-eight years.

BT: But don't they stand out in terms of number of properties listed? That in a way helps the consumer who wants volume and choice.

Sharma: We lead in terms of genuine properties listed because most of the properties listed are fake... about 80 per cent of them, I would say. We have close to 7.5 lakh properties listed on the platform which are genuine and that is a much bigger number than the 15 to 20 per cent of their genuine listings. We have launched the New Projects platform just nine months ago and now we have 18,000 new projects(9,000 to 10, 000 builders on board) which is even more than what anyone has.
 
BT: But Commonfloor does put in verified properties?

Sharma: They don't even have a data collection team. Often brokers used to put pictures of movie stars instead of the property pictures. We keep a very close tab on our competitors. It is like a Facebook page, wherein I can write anything. We collect more than 100 unique data points for any property...from balcony, chairs and tables, TV, gas pipeline etc. We have a team of 500 data collectors across 55 cities we operate in, which collects the data, verifies the authenticity of the property, pushes it to our backend and then we bring it to the front end or the website.

BT: How do you think Commonfloor is so strong in Bangalore?

Sharma: If you have spent eight years in a particular area, its natural.

BT: What is your positioning in Bangalore?

Sharma: Look, Bangalore is a land-lord driven market, and the number of landlords we have on the platform is higher than Commonfloor.

BT: Tell us more about the Slice View technology.

Sharma: It is an aerial-view feature which gives a 360-degree view of the city and the property. We launched it with the New Projects section which is available for all the 18,000 projects, also gives construction status. We also update this every six months to know the construction status. We are the only platform to give the aerial-view feature. Other features, launched about a year and half back, include the child friendliness index of localities for working parents to know how soon their child can settle down in a new society. We have built a lifestyle rating for societies. In the next one or two quarters, we will be launching an old-age safety index.

BT: Has competition been able to copy some of your features?

Sharma: It's been two and a half years since we launched the company in 2012 with India's first map-based real estate feature. That's how we became famous. None have been able to copy this, though we learnt that people have hired product guys and designers for the same. It's a simple thing which people have not been able to copy.

BT: Haven't people launched virtual tours and stuff?

Sharma: Those virtual reality or virtual tours features are a B-grade version of our Slice View technology and they have launched it only after we launched it... they have launched only this year. We launched last year itself. Copying is not a big thing. If they are busy in copying, when will they get the time to think of making products?

BT: What is your Data Science Lab like?

Sharma: It is a group of 30-40 of the most amazingly talented people in the country who have left jobs as Google, Twitter and Microsoft. They have created all the features from Child friendliness index, lifestyle index etc.

BT: You were planning to hire 500 more in the tech team?

Sharma: Yes, our team comprises technology for the desktop, technology for mobile, tech for the tablet and the Data Science Lab. We will do that over the next couple of quarters. Currently we have 500 employees in the technology team.

BT: You are lining up to the IITs and IIMs to hire talent. How competitive is it?

Sharma: We offer industry standard salaries and the response we have got is amazing. We were the youngest startup (only two and half year old) to get day-one slots across IIT Delhi, IIT Mumbai and IIT Madras. We got day-zero and day-one slots across all IIMs. The mood internally is rather than going to the biggest corporate, why not go to the fastest growing startup? We believe we should pay a person enough so that he is not worrying about money and concentrate on work. By no means we are giving exorbitant salaries though. We have not bent ourselves to woo people.

BT: Which are the areas in tech that are being contested hotly?

Sharma: These are product managers and mobile application developers among the seven to eight hot categories. The industry is becoming very competitive for these skill sets. Our mobile app development team consists of fresh graduates from IITs, people from Google, Facebook, Microsoft who have build some of the world-changing products.

BT: You don't look at hackathons?

Sharma: Not quite... .

BT: You are advertising quite a lot. How much are you spending on it?

Sharma: Buying a house is a one in a life time decision yet people have to deal with so much of fraud and negativity. We want to bring optimism to this industry. That is why we want people to 'look up'. That was the though process behind our brand campaign. We have not been marketing in the last two and half years...that is only in the last few months.

BT: Your cash burn rate is too high. Your thoughts?

Sharma: Real estate is not an industry like social media where you don't know when you will make money. Real estate is a $20 billion industry of which 5-10 per cent goes into marketing. In this industry, revenue is like opening a tap.

BT: What will be your major revenue streams?

Sharma: The majority will be search and transactions. We did a pilot with our New Projects platform and there were builders who were paying us Rs 15-20 lakh per month for listing each project. The same builders pay much lesser to other portals. It is that sales cycle is taking time. We are currently focussed on building the product and when the time comes, we will start extracting money from this industry like no other player has done before.

BT: What's the average listing fee a builder pays?

Sharma: The industry average is between Rs 1-3 lakh per month. Our average with even small builders is Rs 20 to 25 lakh. Our quality of leads perform six times better, though our fee is three to four times higher.

BT: What are the targets you have set for yourself?

Sharma: We want to map every single house in the country. We list about 4,000 to 5,000 houses every day. We have grown 10 times over the last six months, when we were listing 400 to 500 homes a day. Over the next one or two quarters, we plan to list 12,000 to 15,000 houses every day. Given the pace we are growing, raising money is not a variable.