Info Edge (India) Ltd, which runs online businesses like job portal Naukri, realty site 99acres and matrimonial platform Jeevansathi, made its fifth strategic investment in a year last month. It acquired AmbitionBox, a discovery platform that assists job-seekers with company reviews, company information, interview tips and advice. Hitesh Oberoi, Info Edge’s managing director and chief executive, told VCCircle in an interview that the company is on the lookout for the right portfolio fits to power its recruitment business. Besides, he underscored its strategy to step up in-house investments in emerging technologies like machine learning, deep learning and artificial intelligence. Edited excerpts:
In this dynamic business scenario, what’s Info Edge’s core focus?
We have been focussing on three core areas. First, mobile. We are excited about the advances in the space. A large part of our business, in fact more than 60% of our traffic, comes from mobile phones. We will continue focussing on and experimenting with mobile to explore opportunities.
Second, matching technology. We acquired MakeSense and integrated it with our search engine. We have also been investing aggressively in machine learning and Big Data over the last few years to grow our matching algorithm.
Finally, cloud business. With TooStep, we now have a recruitment management system within the company. Earlier, we were more of a sourcing company from where people used to source résumés and candidate profiles. Now we are expanding into this whole area of recruitment automation. We tell our partners that we can help them automate their recruitment processes, manage referral hiring programmes, improve their corporate career site, streamline interview processes, and more.
We are building new tools and processes in our recruitment management business. That’s an area where we want to expand and invest more. We have launched this whole suite of products, including career site manager, applicant tracking system, and recruitment process manager.
Do reports of a hiring slowdown worry Naukri?
We haven’t seen any major slowdown in hiring. It is possible that hiring has slowed down at some companies, but they are not actively cutting their spend on Naukri. I cannot comment on what’s going to happen six months from now, but so far we have not been impacted much.
Has your realty business 99acres recovered from demonetisation?
Demonetisation had a major impact on the real estate industry for three-four months. Searches on our platform were down 40%. However, since February, things have been back to normal. The traffic on our platform is now higher than what it was before demonetisation. But for demonetisation, we would have broken even in the fourth quarter.
We see a big opportunity in this business in the long run. Therefore, our immediate objective is not to make money or break even, but to grow revenues fast and gain market share. If it requires more investments, we will do that.
How is Jeevansathi performing?
Jeevansathi has done very well in the last three quarters. It’s now India’s fastest-growing matrimonial site, outpacing both BharatMatrimony and Shaadi.com. We will continue investing in this business in the foreseeable future as well. Again, Jeevansathi is at a stage where if we want, we can break even. But our focus is on top-line growth and more market share, and not so much on profitability because we see a big opportunity here.
How is Shiksha.com shaping up?
It is close to breaking even. It’s a good business, but we have to figure out how to scale it. For Shiksha, the challenge is not competition—it is how big the market is and how big the category can become. We’ve a play in the engineering and management space, and we are also testing the ‘study abroad’ segment. The focus is mostly on the advisory space. We are looking at more segments in the section.
Zomato seems to be the best-performing entity in your portfolio.
Since it is an independently run company, I cannot talk much about it. They put up a fantastic performance last year. They have been experimenting with a number of business ideas, and are turning profitable in many markets. They have managed to scale up revenue and cut costs. The burn rate has significantly reduced. Food-ordering is growing phenomenally while they are also getting into cloud kitchens. The outlook for Zomato is very bright.
What’s your overall investment outlook?
Normally, we acquire companies in the segments we operate in. We will keep investing in startups. We usually cut the first cheque for them, watch them grow over time and, if we are happy with their growth, we infuse more money to help them scale. The good news is that valuations are getting corrected in the private market.
We don’t go by the category; we look at the team and the idea instead. By and large, we restrict ourselves to business-to-consumer (B2C) companies that have a strong technology component and core focus on the Indian market. We try to stay away from companies that are likely to require a lot of capital as they scale up.
Since we are not a traditional venture capital firm, we don’t go by targets. We are more opportunistic. When the market is super-hot, we stay away. But when it corrects, we look for opportunities. We are under no pressure to make investments or exit them.
We are open to acquisitions in the recruitment space. We would like to invest in companies that can add value to our customers/job-seekers, and companies that we can help scale.
Which sectors are emerging according to you?
We are excited about advances in machine learning, deep learning and the whole spectrum around artificial intelligence and analytics. As far as our businesses are concerned, we are investing aggressively in these technologies. We may not invest a lot in companies in this domain because these are usually more business-to-business (B2B) than B2C. That said, this is one area we are excited about. Also, mobile, as I said earlier.
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