Manish Kumar Sinha, co-founder and former CEO of real estate portal Favista, will head online classifieds portal Quikr’s soon to be launched real estate bet, QuikrHomes.
In a telephone interview, Sinha confirmed his role to VCCircle but declined to elaborate on the company’s plans. Quikrhomes.com is likely to go live in a month or two.
Sinha, who joined as executive vice president, is a classmate of Quikr founder Pranay Chulet both at IIT Delhi and later at IIM Calcutta.
It is not clear what Sinha’s signing up with another real estate player would mean for struggling Favista, a Gurgaon-based real estate portal that he co-founded and which has failed to gain traction amid deep-pocketed rivals.
On December 2, 2014, The Economic Times reported that, another online real estate site, IndiaHomes was looking to buy Favista for about $2 million. Favista has denied that story.
The musical chairs and entry of new players into India’s nascent digital real estate business happen amid a scramble to shore up business and talent, fueled less by underlying business but more by startups armed with significant recent investments.
Indeed, before joining Quikr, Sinha appeared to have held conversations over another unpublicised job search—that for the role of India CEO of Housing.com. It is unclear how serious those conversations were.
Search firm Spencer Stuart has been handling the search since January, but recent events involving Housing.com’s high-profile co-founder and CEO Rahul Yadav have led to mounting speculation about likely top management changes at the site.
While Housing.com’s search appears to have been initiated by the current management—at least that is what Spencer Stuart has indicated to prospective candidates—there has been speculation about tensions between some investors and founder-managers at Housing.com, centered around the outspoken Yadav.
Asked if the search was intended to find a potential replacement for himself as CEO, Yadav didn’t directly address the issue, only saying that the company is looking for a dozen “strategic business unit CEOs” and that some of those slots could be filled by the company’s many co-founders.
Indeed, Housing.com named Ravish N, one of the co-founders, as CEO for its recently acquired real estate discussion forum India Real Estate Forum (IREF).
When asked if all co-founders will become strategic business unit chiefs, Yadav responded, “We are a meritocratic organisation. Except for one or two, most likely all will be non-co-founders.”
Three separate people confirmed to VCCircle that the search for a new CEO has been going on since January. "The investors could see that things are not going well; losses grew multi-fold and targets are not being met," said a source with the direct knowledge of developments at Housing.com.
This person added that the plan was to finalise a CEO candidate before the next board meeting, which is likely to happen within the next few weeks. It is believed that a key Housing.com director and investor SoftBank’s executive vice chairman Nikesh Arora is expected to be in India around then.
Softbank led a $90 million investment round in Housing.com in December 2014.
Some industry watchers also suggest a scenario in which one of Housing.com’s early investors, former Network 18 CEO Haresh Chawla, could step into an interim role, while investors continue to look for the new leadership.
Chawla is a relatively hands-on investor, with a track record of managing businesses. “Chawla has been heavily involved in Housing.com for the last two-three months. As an early stage investor, he knows the company very deeply,” said the source cited above.
This information could not be verified as Chawla did not respond to an e-mail. (Update: Following publication of story, Chawla responded in an email: "This speculation is totally baseless." He added that he continues to mentor and support the Housing team as I do with my other ventures". He also pointed out that he cannot take an interim role at another company since he is full time with private equity firm India Value Fund where he is a partner.)
It is not clear how the large group of co-founders, who started Housing.com in 2012 and are deeply loyal to Yadav, will respond to any investor-forced management changes.
Despite his aggressive statements and public outbursts, Yadav is considered the guiding vision for the three-year-old company and intimately involved in every aspect of Housing’s current decision-making.
Yadav has been in the news in recent weeks after publicly attacking Sequoia Capital India MD Shailendra Singh for his alleged attempt to poach a Housing.com employee. Singh also responded publicly attracting significant media attention and scrutiny of Yadav’s management style.
Soon after, Yadav also wrote a staff email that took on coverage of his company in The Economic Times. He alleged that the newspaper’s parent, which owns MagicBricks, another real estate search company, was maligning Housing.com, thus casting doubts on the coverage.
VCCircle broke the news and also reported that the Times Group, the publisher of newspapers The Times of India and The Economic Times, sent a legal notice to Housing.com, its management and directors, seeking an unconditional apology and Rs 100 crore compensation for what it claimed was defamation.
It is unclear where that dispute currently stands and Housing.com, which has embarked on a major branding campaign, continued to advertise in newspapers of the Times Group.
India’s real estate market is in a prolonged trough amid relatively slow sales of both new homes as well as lived-in ones, amid weak consumer sentiment and over-supply of new homes.
Meanwhile, India’s long-term demand for new homes, widely estimated at around 5 million homes annually, and increasing willingness among urban buyers to start researching—if not buying—homes online have seen a slew of startups raising capital and going after the business.
That has forced staid but veteran online real-estate listings companies to try and respond. Info Edge-owned 99acres.com raised $125 million through a rights issue last year, while Magicbricks.com, the online real estate classifieds arm of the Times Group and the reason for Yadav’s diatribe, is currently looking to raise $100 million and is repositioning itself.
In November, PropTiger.com raised about $36 million in a round that saw News Corp taking a 25 per cent stake in its Singapore-based parent company, with existing investors SAIF and Accel also adding to their stakes.(In an unrelated move, News Corp also acquired Mosaic Media Ventures Pvt Ltd, the parent of this website, in March.)
Industry observers see a flurry of acquisitions and executive moves in the nascent digital real estate as early signs of a possible shakeout as investors focus on revenues and execution, and companies start shoring up their flanks.
Bangalore-based CommonFloor.com is also looking for a chief business officer while IndiaProperty.com is now said to be on the block after initially looking to raise capital.
An IndiaProperty.com spokesperson denied they are up for sale, “There is no truth in these speculations. In fact, we are in the final stages of announcing another round of funding.”
Housing.com has also tried to use its funds to shore up revenue and new businesses, acquiring real-estate discussion forum IREF. It has also said it is close to acquiring India’s leading B2B real estate data provider, PropEquity for around Rs 80 crore from Och Ziff.
Despite the already-tough conditions, the opportunity to actually generate sales—companies such as IndiaHomes.com and PropTiger.com are believed to have annual revenues in the Rs 50-75 crore range—is attracting classifieds players that are burning cash without significant revenue.
Quikr decided that QuikrHomes is one of five new verticals the classified portal will launch. Last week, Quikr announced that its parent Quikr Mauritius Holding Pvt Ltd raised $150 million (over Rs 900 crore) from existing investors Tiger Global and Sweden's Kinnevik, besides a new investor Steadview Capital Management.
The company said it will use that capital to build its mobile business and to develop individual categories including real estate, cars, jobs, services and goods.