SoftBank has come to Housing's rescue by putting in Rs 100 crore in the Mumbai-based real estate portal. The funding comes at a time when the grapevine is abuzz with rumours of Snapdeal acquiring Housing. The company said in a statement that the fresh funding, which follows a $90 million round in late-2014, will be used to drive new strategy and accelerate growth plans. However, according to YourStory’s sources, Housing ran out of cash and this round is meant to keep it afloat till its acquisition by e-commerce major Snapdeal.
The sources, who have direct knowledge of the discussions, indicated that deal will go through in the next fiscal. Jason Kothari, Chief Executive Officer of Housing.com, said,
Softbank’s continued support as both investors and advisors to Housing is invaluable to us and signifies their long-term commitment to the Company. We believe 2016 will be a great year for the company.
Housing has been in the news last year for mostly wrong reasons, like the run-ins its Co-founder and former CEO Rahul Yadav had with investors and media or the massive allocation of funds for marketing. The company also laid off over 300 employees as it shifted focus from rentals to sales.
The company claims to have 85 million visits in 2015 and 1.7 million verified listings. Housing has also acquired a few startups Indian Real Estate Forum, Realty Business Intelligence, and developer centric software HomeBuy360.
Since Rahul Yadav's ignominious exit from Housing last July, the company has been trying to get its act together. It changed its focus to sale of homes compared to rentals and also cut down its employee base in an attempt to curb spends. This round could be SoftBank's attempt to show that it still backs the company and has not written off its investment. However, none of the other existing investors (Helion Venture Partners, Falcon Edge Capital and Qualcomm Ventures) participated in this round. Housing will have to do much more than just raise a of funding to ensure it gets back on its growth path. The online real estate industry is still a wide-open space despite the presence of a number of players, including biggies like Quikr that just acquired Commonfloor. Finding a home, to buy or to rent, is still not an easy process for Indian consumers. Whether the deal with Snapdeal goes through or not, the team at Housing has an uphill task to re-create the magic that surrounded the Housing brand not too long ago.