In this article we will discuss why housing.com failed even though it had IITian backed team with crores of rupees funding from investors. In 2012 as real estate market was totally unorganised in India, people can`t sell or rent their apartment very easily.
At that time an IITian Rahul Yadav with his friend was looking for a flat. Even after meeting so many brokers they could not find a proper flat for them. That time they realized that there was a huge gap in supply and demand market which he took as a business Housing opportunity.
Premise
They mainly found two points during their research. People need a lot of time to discover a proper place according to their need. Buyer and seller can not find one another without the help of broker. They also found that broker was not at all transparent to the buyer and seller. Housing
Main Focus
Thus, two IITian start their business named as housing.com. they focused mainly three parts. They make their platform customized for every customer. Buyer and seller can find actual the people they want to rent or buy.
They also focused on the part that most of the listed houses get their tenant quickly so that owners did not have to loss his rent. They encouraged the owners to publish the photos of the flat so that no misunderstood create between owner and tenant.
Problems
After getting initial success a lot of investor showed their interest in this company. But housing.com had a big problem which we can describe as synergy in energy. It simply means there had been ideological difference between owners and investors of this platform.
On one hand Rahul Yadav was a hyperactive decision maker and action taker whereas other investors wanted to run their company traditionally. Housing.com get their revenue from the subscription model where with some thousand rupees anyone could list their property for sale or rent.
Final Fate
Mr Rahul wanted to play bigger game by introducing exclusive deal in their platform where newer apartments will be available on only their platform. But he could not make everyone ready for this decision.
Some of the investors even poached the employee of the company. This internal politics when revealed online, the reputation of the company started to see downfall. Big investors like soft bank started to loss their interest in the company.
After some time, Rahul Yadav saw a company with great potential and wanted to buy that company in 7 crore rupees. His decision was in long pending by investors. They have to spend 17 crore rupees than instead of 7 crore rupees to buy the same company. It made 10 crore rupees loss to the company. One dishonest investor blamed Rahul Yadav for this and terminated him from the company.
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Rahul Yadav distributed his 250 crore rupees stake to the two thousand employees of the company and left the company. After the termination of founder very quickly housing.com lost their vision and credibility by changing CEO many times. No one run the company as Rahul did. Ultimately, the company which had 1500 crore valuations, they had to merged with Proptiger in just 450 crore rupees.