Peer-To-Peer Rental Service NoBroker is the Future of Real Estate Brokerage
The team believed that paying hefty brokerage cannot be the only option to find a new home and there is a scope of broker free platform that removes this information asymmetry and provides a marketplace for free exchange of this information. The co-founders Amit Kumar Agarwal, and Akhil Gupta started NoBroker and Saurabh Garg supported them as Chief Mentor & Angel Investor.
I approached Amit with a request to share his start-up experience and he agreed to do so. Here is what he has to say about his start-up journey.
Braj: What’s the story behind the start-up?
Amit: We wanted to start something of our own and were exploring multiple ideas. But right from the ideation stage we were very clear that we want to solve a customer pain point with our offering. That’s where the concept of starting a real estate portal without brokers came from. Myself, Akhil and Saurabh, all three of us went through very bad experiences with brokers. The broker begins with showing the worst and non-moving flats, in the given rental range, which do not fit the requirement. This results in a complete waste of time and causes great inconvenience as one is unable to find a suitable house quickly. Also when we looked up online, we realised that all existing players are working with brokers. So we decided to challenge this inefficiency and enable the customer.
The idea of NoBroker was conceptualized in late 2013 and the website was launched in March 2014. We witnessed massive growth and high rate of acceptance and adoption from customers, due to a huge latent demand for non-brokerage marketplace. Due to this, in a short span, we have become the world’s largest ‘Peer-to-Peer’ ecosystem in real estate with 3 lakh user base.
At NoBroker we believe that looking for a house should be a happy, convenient and cost-effective experience. And that’s what NoBroker offers – hassle free house hunting. We have solved a complex problem in the most simple and straight forward way. We analysed the entire value chain of house hunting and replaced everything that the broker does with technology. On NoBroker.com you can find smart recommendations based on real-time data – something which an offline broker cannot provide effectively. NoBroker helps the customer in making an informed decision.
Braj: The start-up landscape in India is buzzing with unique ideas, in this environment what triggered this particular start-up?
Amit: Essentially the entrepreneurial bug bites you very early back in IIT only. For us also, the passion for a startup was not new. But the turning point was when one of our dear friend and now, angel investor/mentor with NoBroker, Saurabh Garg started his venture, The Four Fountains Spa. His passion and success with the venture was very encouraging and gave us the motivation for our own startup.
Braj: How did you decide the name for your start-up? Do you have any story to share about naming, logo design, branding?
Amit: Our friend Saurabh came up with this name ‘NoBroker’ and since then it has saved us crores in marketing costs. The logo signifies zero percent brokerage. The percent sign is in reverse shape.
Our competition is not with online players but with the entire pool of unorganized brokers. Our vision is to induce efficiency in matchmaking with the help of technology and to reduce cost of transaction to a small fraction of what it is currently, with brokers.
Braj: What is one big problem you are solving with help of your venture – NoBroker?
Amit: The concept of NoBroker is disruptive for the entire industry. We are trying to set order in an unorganized sector. All existing online real estate players have been working with brokers. Despite the good technology solution by some real estate players, two biggest customer pain points remained unsolved. First is spurious listings on online websites which leads to imperfect matchmaking and second is the high cost of transaction. We have solved this problem with NoBroker. We are helping our customers save more than 15 crores of brokerage every month across 4 cities (Mumbai, Pune, Bangalore & Chennai).
The residential rental brokerage amount globally is $200 billion per annum. In India, $4 billion is paid in brokerage annually across top 20 cities. In India, there is no C2C marketplace in rentals apart from NoBroker.com. All existing online real estate players have been working with brokers.
In fact, no one believed that the real estate space can work without brokers. But we have proved them wrong by creating the world’s largest ‘Peer-to-Peer’ network of genuine owners and tenants. There is no sizeable organized competitor who can match our technology and algorithm of identifying and eliminating brokers. Our main competitor is thus, the entire pool of unorganized brokers.
Braj: What is your business model? As of now, do you have any defined revenue streams?
Amit: Currently our services are completely free of cost, which is always a feature of building a network-effect business. Overall, in this business, monetization is very easy since customer is already paying a hefty fee for the next best alternative. What this marketplace will do is to crash this fee to one tenth. Customers regularly tell us that they will be more than willing to pay this fraction of the fees as long as NoBroker continues to provide them fresh and large pool of house inventory and an ecosystem of genuine tenants and owners. We will start charging 6 months from now.
Braj: NoBroker has first mover advantage. In fact, you are rewriting rules of the game. Please comment on the strategies your company is adopting to capture a market share?
Amit: At NoBroker we believe that looking for a house should be a happy, convenient and cost-effective experience. And that’s what NoBroker offers – hassle free house hunting. We have solved a complex problem in the most simple and straight forward way. We analysed the entire value chain of house hunting and replaced everything that the broker does with technology. No other player today offers this. We will command a high market share through our unique value proposition. And the validation of our unique offering is that today we are the world’s largest ‘Peer-to-Peer’ ecosystem in real estate with 3 lakh user base. We have grown 10 times in the past 3 months across all key dimensions: website visitors, registered users and new property listings.
Braj: What kind of background, domain expertise, and attitudinal aspects are you looking for in your employees?
Amit: From 2 founders and 1 angel investor friend, today we are a 100+ team of employees across tech, marketing and sales. We are getting an overwhelming customer response and have a monthly traffic of 1.2 million. Hence we are bullish about our expansion. As we grow we hope to get liked minded people on board. The most important attributes we look at while hiring is the ability to experiment and learn and handle growth aspirations with lot of independence in work.
Braj: What are the current marketing efforts being incorporated?
Amit: Our focus is on innovative marketing initiatives for new customer acquisition. We are also spending on digital marketing. However, it’s word of mouth from our customers that is our biggest asset which contributes to our growth.
Braj: How do you see your company evolving in the next five years
Amit: In next 5 years we see ourselves as leader in rentals in not only in India but also in leading markets across the world. We are not facing any major obstacles given the lean and scalable model we operate in.
Braj: Are you considering any strategic alliance or other measures to augment your market reach or business capabilities? How is the company being funded?
Amit: We keep on tying up with businesses who can help our customers from legal paperwork to settling in a new house. NoBroker was angel funded by Saurabh Garg (co-founder of Four Fountains De-stress Spa) who also acts as a mentor. Then we raised Series-A funding of $ 3 million from SAIF Partners and Fulcrum Ventures early this year.
Braj: Any tips you would want to share with aspiring entrepreneurs in this field?
Amit: When you start any new task, you are faced with difficulties. But the difference in winning and losing lies with how you handle these problems. I’m always on the lookout for solutions. In fact that is the very basis of our start up. As we grew from 3 people to now a 100 people team, it humbles me to see so many faces share our dream and passion. The importance of work done by each individual for the firm is different. Someone is able to add more value, some other adds less. But the vital thing to realize is that work by each individual is important. Once that is realized, you develop respect even for office boy’s work because even he is adding to shareholder value.
Braj: Would you like to highlight any other aspect of your company, or make any concluding statements?
Amit: At NoBroker we believe in innovating. But we also respect failures because if you are trying something new, setbacks are inevitable. And after each setback, you will try harder and emerge victorious. At NoBroker, we are all innovators in our respective roles, challenging the obvious.
Braj: You mentioned innovation and challenging the obvious is the key to growth at NoBroker. Would you like to share any recent innovation?
Amit: Recently we launched our mobile app which allows our customers surf the site, while on the go. This is very beneficial for our customers since 50% of them access us through mobile. One very innovative feature that we have introduced is ‘Click & Earn’. This feature helps us in ‘crowdsourcing’ of owner listings. This has never been done anywhere before by any online player anywhere in the world. All one has to do in the ‘click n earn’ feature is click the photo of a ‘ To-Let’ board, send us through app and get cash awards for every successful listing. A user can earn 100/- per verified listing with no upper limit on number of listings. We are getting humongous response from our customers for this feature. Every day, we are getting 100 to 200 direct owner properties on our website due to this. With Crowdsourcing feature of ‘ Click & Earn’, we have enabled everyone in the city to be a broker- buster.
Amit concludes: In all that we do, we never lose our focus on meritocracy, transparency and ensuring fun at work.