YourOwnROOM dispels the problem of finding a home-away-from-home for singles
YourOwnROOM is a Bengaluru-based startup in the space of online managed rentals for singles where there is end-to-end management for both the tenants and homeowners.
One of the biggest problems for 29-year-old Sulochana was finding a home away from away. Most landlords were wary of renting space to a single working lady, and asked questions like – ‘Do you have male friends?’ Do you party and drink? And the list is simply endless.
It was looking at this that 42-year-old Prabhat Kumar Tiwary, along with his longtime colleague, 36-year old Sachin Joshi, started YourOwnROOM, a one-stop platform that brings together the right property and the right tenant, managing the entire show for both owners and tenants. A Sloan fellow with a Master's in Business Administration from Stanford Business School, Prabhat has over 20 years of global experience in software product development, IT application services and digital technologies; Sachin has 16 years of experience in key leadership and management roles.
Fleshing the idea out
Prabhat, CEO and Founder, says the horror stories of accommodation hunting Sachin and he heard from friends and young single colleagues, coupled with the fact that several apartments remained locked up in cities, strengthened their resolve for starting YourOwnROOM.
They soon roped in Rewat Laxman, a director and practicing orthopaedic surgeon in Bengaluru with DNB Orthopaedics and Sparsh, as the initial investor. Prabhat says,
“They were the first guys I brainstormed with to build on a nascent idea I had. Along with the initial team members, we spent several weeks brainstorming in Starbucks and Costa Cafe in Koramangala, Bengaluru. We wanted a stronger sense of purpose in our jobs. We were clear that it was not about buying, selling or listing of real estate but was about optimising inventory and giving more value to the consumer, particularly the single demography.”
Prabhat says when they acquired their first 10 properties and managed to fill them with tenants very quickly, they realised that their idea would work.
The team believes that if in the past the primary consideration in choosing a living space was the cost, today for the mobile, discerning urban singles, the quality of life has taken precedence over the cost factor. However, in India the biases towards singles has resulted in a low supply of good living space that is needed for the young singles of today.
Finding a new way
“The old way of long and inflexible leases, expensive brokerages and deposits, haggling between landlords and tenants over rental payments and maintenance issues, claustrophobic and shabby PG accommodations in far-flung locations with poor last-mile connectivity isn’t intuitive,” asserts Prabhat.
Being an online platform, both owners and tenants can find and display places on YourOwnROOM. The company, in turn, gets into an arrangement with the property owners and then rents out the individual rooms with common living space to singles.
YourOwnROOM manages the listing on the portal, site visits, agreements, invoicing, payments, maintenance for both the owners and tenants. The tenants are typically single working professionals, singles on short term deputations, students, people facing personal transitions like separations.
Prabhat adds that this provides the owner the security he or she is seeking for as the tenants they get are screened, have their legal paperwork in place and even an assurance of premium returns.
For the tenants YourOwnROOM offers properties that are 15-30 minutes from most work locations and are in safe neighborhoods; they also offer the flexibility of four months’ rental terms and reduced deposits thus significantly improving quality of lives of singles.
Building the trust
However,convincing and winning the trust of the homeowners was a herculean task. The team also had to focus on building the technology platform and work towards getting the right unit economics.
“As founders, we used our personal credibility with known homeowners to sell them the idea. Our initial focus was on developing the business model, product and service offerings and sales and operations process and technology solution,” says Prabhat.
Today, the sharing economy as a concept in India is fast growing. The global sharing economy is believed to touch $335 billion by 2025. Players like AirBnB and Stayzilla are working hard to redefine the way we choose stay in different places. As of 2013, close to four million people had stayed at AirBnB.
In India, the concept of finding a proper home away from home is picking up and platforms like Nestaway and Homigo are growing fast. YourOwnROOM has raised an undisclosed funding from angel investors. Sachin adds that the funding will be utilised to implement analytics and deliver a stronger customer experience of property search.
Speaking of the market and why he chose to invest in YourOwnROOM, Ravi Chaturvedi, mentor and angel investor, former President of P&G and former Group Chief Executive of Jet Airways says,
"The residential rental market in metros is highly fragmented, unorganised and, frankly, not dedicated to delighting the customer on the demand side. And the people who rent out their premises worry about property's security and sustained returns. YourOwnROOM's mission is to consistently deliver a delightful customer experience to the renter and build a trusted relationship with the homeowners, thus creating great value for all the stakeholders. That is the recipe for building a sustainable, differentiated business in a cluttered space."
The team claims an annualized monthly revenue run rate of over $ 200K with a positive gross margin. With the current projections the team aims to do an annualised run rate of $1 million by the end of next financial year.
Future plans
YourOwnROOM operates on two revenue models - Lease2Manage and List2Manage. In Lease2Manage, the profit is the difference of rent minus the operating cost and in List2Manage, the profit is the commission charged to the owners.
“I am impressed with the customer stickiness YourOwnROOM has been able to achieve in terms of property renewal with owners and long-term rental contracts with tenants,” says Aditya Kandregula, US-based angel investor and a senior executive in a technology company and another investor on the platform.
The platform aims to be among the top three in the country. The team adds that the funds raised will be primarily utilised in property acquisition, developing technology and boosting their marketing and sales endeavours. They also say that digital marketing strategies form the company’s core focus. The company plans to sign up with
They have also tied up with several companies to help expand their network in food delivery, furniture rentals, home maintenance, housekeeping and taxi services space.
Prabhat adds they are looking at strategic investments and are in advanced talks with a few potential investors, and hope to close the same in the next two-three months.
“If you look at the combined market share of all organised players in online managed rental it is less that 10 percent. I am super excited with the opportunity in front of YourOwnROOM as it reminds me of organised retail 10-15 years ago.” says Narasimha Murthy, angel investor, IIM Bangalore alumnus, co-founder of a healthcare software product company and one of the investors in YourOwnROOM.