Google Capital backs online real estate portal CommonFloor
maxHeap Technologies Private Limited which runs CommonFloor reported that it raised Rs 60.35 crore from Google Capital
Jan 08, 2015
Source : The Economic Times

 

BANGALORE: Online real estate portal CommonFloor has raised funding from Google Capital, just three months after receiving $30 million in an investment round led by Tiger Global.

According to a filing with the ministry of corporate affairs on 24 December 2014, maxHeap Technologies Private Limited which runs CommonFloor reported that it raised Rs 60.35 crore from Google Capital.

Sumit Jain, cofounder and chief executive of CommonFloor confirmed the deal but declined to share the amount invested in his company.

"We will be investing in three key areas - technology, product, and marketing, mainly focusing on innovating our technological platform," he said. Jain cofounded CommonFloor with Lalit Mangal seven years ago. The company aims to also expand its 1000-member team.

The investment in CommonFloor marks Google Capital's third investment in Asia; it earlier funded Chennai-based enterprise software maker FreshDesk and China's InnoLight, an optical technology company.

Established in 2013, the investment firm which has backed workplace comparison platform GlassDoor and online survey service SurveyMonkey, focuses on growth investing while Google Ventures, invests in early stage companies.

"The online real estate market in India is poised for tremendous growth, which is why we're excited to work closely with CommonFloor's excellent team in the months and years ahead," said David Lavee, founder and partner at Google Capital.

Experts are of the view that younger and digitally savvy consumers who find it expensive and time consuming to search for properties on the ground, will increasingly turn to online portals for help. The market for real estate services is estimated to reach $180 billion (over Rs 11 lakh crore) by 2020.

"Investors are keen on this space because it represents a lucrative frontier in the transformation from online to offline space," said Sunil Wattal, professor at Temple University in the US.

Venture funds have aggressively backed realty portals in the past year. Japan's Softbank led a $90 million funding round in Housing.com while PropTiger.com raised $30 million (about Rs 186 crore) from Rupert Murdoch's New York-based media company News Corp for a 25% stake.

Info Edge, the owner of 99Acres, has indicated its intention to back the portal strongly after having raised Rs 750 crore from institutional investors in September

"There is place for more than one big player but the person who decides the winner is the customer," said Aashish Bhinde, Executive Director at Avendus Capital.

After the last round of funding in CommonFloor led by Tiger Global, cofounders Jain and Mangal owned about 10.28% of the company, while Tiger Global held about 54%, according to a recent filing with the Ministry of Corporate Affairs. According to the same document, CommonFloor's loss widened about 200% from last year to Rs2882.89 lakhs in the year ended 31st March 2014.

"A house buyer is a potential consumer for everything from a fridge to music systems and architect services, (companies) can cross-sell and generate a lot of value," said Harish HV, LLP Partner at Grant Thornton India.

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