Recently the trend in startups has been around growing fast, scaling faster, and becoming humongous with viral products, ideas & marketing.

But in most cases, such ideas come crashing down in a short span of time, because of the lack of depth either in the product or the customer base.

In this episode, almost after a year and half since we published NoBroker Founder Amit Agarwal’s episode, we have with us his Co-founder Akhil Gupta to talk more about their journey of building NoBroker with depth in every market and focus on customers over the last 10 years.

During the episode, Akhil shares the ups and downs in their journey, along with the initial response they got while they were trying to raise their first round, what are his thoughts about the current & future of the housing market in India, and more.

Notes –

01:26 – Early Product Market Fit moment for NoBroker

07:19 – Clarity to make NoBroker the largest Real Estate solution in India

08:53 – The most challenging obstacles

13:35 – Defining moments in their journey 15:19 – Mistakes they made being founders

16:46 – Key factors why they succeeded

20:35 – Zoho Sponsored – Prashant Ganti on What does Zoho Payroll do and what’s the story behind it?

21:36 – Future Plans

23:41 – How they become the Amazon of Real Estate

25:16 – Passion behind starting NoBroker

30:40 – Why they got rejected by so many VCs

32:29 – Realistic way of building a sustainable growing startup

38:07 – Reason behind the sky-rocketing of rentals in Bangalore

42:04 – Impact of global factors on the Indian Housing market

Read the transcript here:

Akhil 0:00

August or September 2014, some people got ready and one fine day we thought we’ll get three terms tomorrow. But then Housing.com raised $90 million from Soft bank, and the next day even those three investors ran away. Then it took us another three or four months. A typical journalist would ask, how many cities you’re going to launch now every time we raise money. They think we got the money today so we would launch the cities tomorrow. So we have never done that particular thing, we want to be a one stop shop for real estate. You can say we are the Amazon of real estate now you don’t go to Google and search if you want a phone or whatever you go to Amazon and search everything. We are like the Amazon of real estate. Anything related to house job commercial building. That should happen in NoBroker, what we gained from that is, when we started providing houses and houses were given on rent, we got an amazing word of mouth. Each of our happy customers was a free marketer for us, the infrastructure, and what amazing roads are there.

 

Siddhartha 1:25

Hi, this is Siddhartha Ahluwalia, Welcome to 100x Entrepreneur Podcast. Today I have with me Akhil Gupta co-founder and CTO of NoBroker. Akhil, your journey is very inspiring, your and the entire NoBroker team’s. There was a time when you just had started in Bangalore, and real estate brokers came to your office, thrashed your office. They were pelting stones and what else not . I would call that moment a product market fit.

 

Akhil 1:56

True, and we realise it later though. We were scared. But what has happened because we had just started. So we started working on the idea in 2013. August 13th is when I started coding on the software. It was live by March just after my daughter was born. And this is March 14 Till you can say August 13 till February 15th we were bootstrapping it because we were trying to see whether it would work or not because it’s a totally new concept which was there. February- March 15 is when we had set up the office. Something like this penthouse kind of bungalow in HSR layout because in the US everybody starts in Garage. So we said we’ll do it in a penthouse. And in August this happened, so one fine afternoon, me and Amit and I were standing on a balcony. We were just talking and we saw 40-50 People who were coming towards our office and we thought generally some protest must be going on, it’s normal in India and it’s HSR layout, so something must be happening there.

 

And by the time we could realize that we didn’t have a gate in front of our house for some reason the owner didn’t put a gate there. It was like you could just walk into the door and these guys started banging the doors they were trying to come in, throwing the laptops, computers and then me and Amit we went down and then we realized that they were just ready to beat the shit out of us. They are just throwing the slabs around. Once the slab went past our face. Then we just logged ourselves and I went to the second floor and called the police and the police came. I still remember that the police guy came with the specs, aviator and then he stood on the side of the wall and was like, where’s your rent agreement. How are you doing this? And we were like, Boss we have called you. We have been attacked because of the local thing, but how does it matter? We said we have a rent agreement. Let’s go to the police station and that was Madiwala police station.

 

And when we went to the police station, they asked us to sit in that Hoysala. So me and Amit, we sat. There were one or two more guys on the backside, typically how it happens in the movies, the jeep is moving and all the brokers are following the jeep on their bikes, at least 15-20 bikes were there. And we were thinking it was us who filed the complaint and they are taking us in the police jeep and the brokers are following us like a movie scene. But when we reached the police station, the station in charge, I thought was a very smart guy. He thrashed those guys like anything saying that this seems similar to shop owners throwing stones at Flipkart, or Uber people breaking taxis. But he advised us that you should not be in this office. Typically, he advised he wanted whatever it was, but 12 or 1pm that day after that we were out of office. So we could never go back to the office. It was long sealed.

 

Siddhartha 04:54

And you were bootstrapped till then?

 

Akhil 04:56

No, we raised our funds. So we had raised 3 million from Saif Partners which is now Elevation. So we had set up the office. We had around 70-80 people in that particular office at that time. Yeah. So that was a very, very defining moment in our journey because we knew things that we are doing are making an impact. But when this happened, and when it was in newspapers, we started getting calls. And we have a call on our call center recorded where somebody is calling, and is threatening us, thinking they’ll scare us, break the computers and NoBroker.com would be shut. They didn’t understand the concept of cloud, what is cloud? They thought everything’s working from this office. And then all those threats asking us to shut down, we have a local MLA who’s supporting us and all those things. And then when we reached at night also we were getting calls. We had diverted our call center number, all those calls were recorded.

 

We were scared. I can say, in philosophy, that was the point when we knew that now things have moved and we were pumped up. We were certainly pumped up. But maybe after a week, when our investors called us and said Boss, this is the real disruption, like you guys are doing something and that this incident is an example or it’s a proof, as you said, it’s a PMF kind of thing. And an even more fascinating thing was, I think we were 70-80 people, we didn’t know where to go the next day. That afternoon. We sat in a cafe in HSR. We said, Let’s plan how we will do it. So a couple of our startup friends came up and helped us. One guy said I have a Bunglow in HSR where I’m working. There are some empty rooms there, you can work from there. And one guy, Abhishek from Tracxn, gave us his office where he had a coworking.

 

So we split our team, operations was sent there, technology came here. There were no tables, nothing, this big room, little bigger, we had just put the mattresses and we were working out of that particular thing. The next day, not even a single employee took a leave, everybody showed up. And I think that was the most defining moment for us other than the attack, when you know that you’re doing something and people are behind you. That changed our perspective and that gave us the confidence that we’ll end up doing something, and something good will happen out of it.

 

Siddhartha 7:18

And you always had this clarity that NoBroker will become the largest player in the rental and the buying of properties in India?

 

Akhil 7:28

We wanted it to be, clarity depends on execution. I’ll take you back to when I was in IIT Bombay, Saurav was my senior from IIT Bombay. Amit, Saurav were batchmates at IIM Ahmedabad. So I went to IIT in 2000, 2000 till 2005 I have a dual degree and I have seen the change happening. I’m from Kota in Rajasthan, we used to go to bombay through trains. And whenever we had to come back home, to book the train ticket, we had to go to kanjurmarg railway station and from there we would go to VT to book our tickets. Similarly, Whenever we had to go to a movie, there were 4,5 theaters in Gandhinagar, Ghatkopar. And we didn’t even know how many theaters were there. Cut short to 2004 Internet was there in IIT from day zero so we knew how to surf and all, then we realized that there are portals like Bookmyshow, Make my trip. So we used to book our tickets at Bookmyshow and go watch a movie in IMAX Wadala from Powai for 100 rupees and we could choose the seat also.

 

And that was a power disintermediation which was happening similarly, flight tickets, train tickets, we started booking online. So somewhere I knew that technology will be able to change it. And when we were discussing this idea, we said if it has happened in all other industries, why exactly has it not happened in real estate. So theoretically, we knew that this would be something big, it was all about execution. And I think we have been able to execute well to be the number one player in India now.

 

Siddhartha 8:53

What are the other obstacles that came on the way? I believe it wouldn’t have been easy.

 

Akhil 8:58

I think the first one was like after we started, 1st March 2014, is when I made it live. Basically I put in the DNS server so that NoBroker can start, otherwise it would be like that for so many days, and then we started seeing listings happening. People were getting houses. We were going to investors and investors were saying Wow, good, nice traction, but it has not been done in the west,it was a typical story in the Indian ecosystem which has changed now. Why didn’t anyone in the US or UK do it? The US has Zillow which works with the broker, Purple brick works with the brokers in the UK. And it was tough to explain it to them and everybody liked the idea everybody was understanding that theoretically, this is how it should happen. But they were not ready to invest. August September 2014, some people got ready and one fine day we thought we’ll get three terms tomorrow. But then Housing.com raised $90 million from SoftBank, and the next day even those three investors ran away. Then it took us another three or four months where Saif partners agreed to invest $3 million.

 

Nansi 10:05

Hi, everyone. Before we begin, I would like to share that this podcast is brought to you by Prime Venture partners, an early stage VC fund led by Amit Somani, Shripati Acharya and Sanjay Swami. Prime is often the first institutional investor in category defining tech startups in FinTech, SaaS healthcare and education, such as Markit Quizzes, Planet Spark, Bolt and Glip to know more about Prime visit https://primevp.in/

 

Akhil 10:36

The journey will not be there without obstacles. If it is without obstacles, it’s not a journey either you have taken the road which is extremely easy, nobody goes to that particular road or you are not working to your full potential. So that was one, second was a broker attack. Hiring has always been a challenge. But we have been extremely, extremely lucky to have our friends and our colleagues in previous companies to come and join us and take the leadership role. Starting anything new, like when we realized that okay, this marketplace has been built. And first thing we did was how do we add value back to our consumers because nobody trusts a broker in India, everybody is shit scared of the broker and these guys kind of have goons so we became the trusted party. People were looking up to us, like you got us a home, also help us with rent agreement, packers and movers, cleaning agreement.

 

So initially we thought that we would give leads. So we tied up with many different companies and we started to pass on the lead. And everyone was saying we are not getting any conversion and we would be confused like, there is no better source than us who can tell you when exactly Siddharth is moving, because I have got a house for him. Next, whatever days he has to certainly move still conversion is not happening. And that is when we decided okay, we’ll stop this lead business. Anyways, we are a platform, we will become this marketplace even for the services business. So that shift whether to do whether to not do whether to continue being on this side of the business, or get your feet in this business because then it becomes even more difficult that how do you manage so many partners who are not maybe half educated, getting your app out, managing them to adhere to the SOP of your company ensuring that they are giving the best service so that your brand reputation is not coming at the stake. I think that has been another thing.

 

COVID, everybody has seen COVID as COVID came, we saw everything, all the transactions coming down to zero. Moving such a big team to their house, and enabling them to work from their house. And again, we were like I’ll say like you are smart enough to ensure that we have the tech in our control. So within two days, we were able to enable everybody to work from home, take your laptop back home, take your computer back home if you are a call center executive, you will get a call at your home like on your phone, you will get the phone but still all the calls are recorded all the calls are monitored your performance, we didn’t let go our customer experience down even by a notch so I think that was another thing. Now getting people back to the office and making them work is also difficult. I think it’s part and parcel and it will continue to happen.

 

Siddhartha 13:35

But other than your office getting thrashed, what were the other defining moments during the journey so that you knew that now you are onto something big.

 

Akhil 13:43

Office getting thrashed was like proof that we are doing something which is right. When we started saving money for our consumers when they started writing back to us. A lot of people, sir you saved me 25-30k rupees, from this I would buy a table chair for my child or I’ll be able to get something else for my kids or maybe this will help in getting a white good in my house. That was very, very fascinating. I still remember there was a customer in Chennai who gave us three houses to be rented out. And we rented three of his houses without a broker. This is I think maybe 2016 or 2017 and that guy was so happy, he had taken a plan. He was so happy. He sent us three cakes to our office. We said no sir, nothing is needed. He himself figured out where we were because our office address was not on google, he sent us three cakes and said I want to congratulate you guys and your team for getting this thing done so easily for me.

 

Then people started looking up to us saying you guys got me a home, now help me getting a rental agreement in Bombay, I’ve to stand for hours in the office of the registrar, and then we automated that particular thing we started ensuring that even NRI doesn’t have to fly back to India being in the US you can rent your house and get it registered with the government approved rental agreement also, people asking you get me packer and mover, cleaning rentals. I think those were all signals which started telling us that okay, this is something which is working.

 

Siddhartha 15:19

What are the mistakes that you made in this journey?

 

Akhil 15:22

Mistakes, I think one or two are like if you asked me what we made, maybe it was way too frugal. In the initial days, everything was done by us only, even to approve salary I would go to the bank myself and approve it. We didn’t have HR, office management wasn’t there, no AC, for a very, very long time we didn’t even have a fall ceiling, we were like why to spend money on this so I think maybe way too frugal, maybe we could have done it a little better. So that our initial employees who were there in our initial journey with us, they could have felt the warmth more that is one then other than that I think we have been pretty well adjusted to the fact that this business is not going to grow overnight, like there would be an add saying 25 percent off food delivery free, that wouldn’t happen. We have built everything slowly in our business, so typically we don’t regret anything in our journey at this point of time. There are some things which we want to improve if you ask us to go back and improve something otherwise I think it’s a fantastic journey.

 

Siddhartha 16:32

But it will be 10 years in 2023 of you coming full time into this.

 

Akhil 16:36

Yeah. So for the initial few months I was working with Oracle 2014 is when I quit. But you can say that very well 9 to 10 years is like we are full time into this particular thing.

 

Siddhartha 16:46

If you have to distill down your success to 4,5 things, what would those four to five things be, why you succeeded and what’s the reason why we’re here today?

 

Akhil 16:55

Three four things that I personally or three of us feel, typically the three of us think alike. Which is both a good and bad thing. I think one is the customer problem. We have chosen a very good customer problem. It’s a real nightmare. So what we’ve gained from that is, when we started providing houses and houses were given on rent, we got an amazing word of mouth. Each of our happy customers was a free marketer for us, you got a house through us so you’ll go on and tell people about it. So our CAC has been extremely low, historically, and going forward also, it will always be low. So we have a real customer, genuine customer problem, then the way we have executed that is really good because of which we are able to get that trust and build a brand like NoBroker.

 

Hiring right people like mission driven people who came along with us, like if you talk about leaders in business products, we have Amit Sharma, we have Abhas, we have Pulkit, who is in business, so a lot of these people they came from our extremely close circle. Like we are three friends from school, me, Akhil Gupta, Akhil bansal, Abhas Parikh. Three of us are working on NoBroker, and we were in school together, IITs together. Everybody took a different path. But when I was starting up, I asked them Okay, why don’t we do this? They came back, Amit Sharma who is our SVP engineering, we used to work together in one of the companies. So when I was starting up, the first thing when I knew that we had secured the funding, I went to his house and I said, this is what I want to do. And because of that tuning or whatever, I could explain to him what I’m trying to do, he could understand, and he’s with us, then he got his friends. So Pulkit is his friend, Varun is his friend.

 

So I think that team and that more than team, it’s a family. If you come down to our office, we recently went for an off site. It’s like one big family, and in a family, you fight, you scold each other, you get angry, but everything gets settled at the end of the day. And everybody’s working towards the mission. So the great team has been a very good thing, our frugal mindset, which is not the frugality like which I was talking about, not putting the AC and all those things. But even in terms of the way we have built the teams, the way we have built the solutions, the way we have built the tech, we have always taken a conscious decision between build versus buy. Sometimes it might have taken us a little longer, but building in longer always becomes much much much cheaper. Are eye over expenses like just because we raise money we have never ever in the last three rounds.

 

A typical journalist would ask, how many cities you’re going to launch now every time we raise money. They think we got the money today so we would launch the cities tomorrow. So we have never done that particular thing, we have kept our story consistent even with VCs Since we have executed, we have under promise over delivered and even in this it’s not like we got the money so we’ll start splurging it. We have made the conscious right decision on that particular thing. The last round that we raised last November on a billion dollar value that is all lying in our bank. So $210 million is what we raised, we have more than $210 million in our bank. So we are like sufficient money for the years to come. So I think these are few things which we feel have done it in the right fashion.

 

Siddhartha 20:34

Dear listeners. Before we dive further into the podcast, I would like to welcome Prashant Kunti, Head of Product Management at Zoho payroll and Zoho books, Prashant. What does Zoho payroll do and what is the story behind it?

 

Prashant 20:47

So payroll is a Payroll solution from the suite of products. It’s designed from the ground up to completely abstract the payroll complexity and put your payroll compliance on autopilot mode. So what do I mean by this? So, when we talk about abstracting payroll complexity, we mean that a business needs to know just who their employees are, where they work, and how much they get paid. And on putting your payroll compliance on autopilot mode. What we mean is that our ever changing rules and regulations that affect your payroll, and Zoho payroll takes care of all those things business need not worry about all those things.

 

Siddhartha 21:25

Thank you, Prashant. Dear listeners, you will find more about Zoho payroll in the show notes. Now let’s further continue with the podcast.

 

What are the next things besides launching in new cities that you want to do for the next two or three years?

 

Akhil 21:40

So as I was talking to you offline, we have like four business lines, correct. NoBbroker core, which is all about renting, buying, selling of secondary properties, buying, selling new properties from the builder, which is a business which we started around 18-20 months back, doing extremely well. Home services, which includes moving packing, cleaning, painting, anything related to your house, then financial services like when you’re buying a house, getting the due diligence done encumbrance certificate, helping you with the deeds, your rental agreements, loans, rent payments, and then NoBrokerhood which is like our way to be in the life of our consumer and help societies digitize automate every single thing of theirs, like, we will put the boom barriers, boom barriers are automatic in the society, and we don’t partner with anyone, we have done it ourselves. So that we have control over the tech. So your car will come and the boom barrier will open itself, you can even restrict that particular thing.

 

So all of it needs a lot of investment. Like we just said, if you talk about home services, this Diwali season was a great success for us on the cleaning and the painting side. So that is the business which has just started 18-20 months back, it will grow deeper in existing cities on that particular business on Co- real estate sites in cities like Bangalore, maybe we have 20-25% market share, but we want to increase it to 60-70%. In newer cities like NCR and all we are still small. So we will go deeper on those things. NoBrokerhood, we are investing heavily. So NoBrokerhood is something which we started almost, I think three years back. 2019 is when we got serious about that particular thing. And we have grown leaps and bounds on that particular business with amazing customer experience. So that is one business where we will invest both in terms of product and money. So I think these are the things which will keep us occupied for the next few years.

 

Siddhartha 23:40

And what’s the ultimate goal like where do you want to be in these next few years?

 

Akhil 23:45

Where we want to be so I think we should be in the top 50 cities in India like our version one Dotto of proptech portals which are in 40-50 cities where they are helping people. So I think that is one goal. But what we want to do and what we are trying to do and maybe we are there on that particular thing is that we want to be a one stop shop for real estate you can say we are Amazon of real estate. Now you don’t go to Google and search if you want a phone or whatever you go to Amazon and search. So we are like Amazon of real estate, anything related to house, job commercial building, that should happen in NoBroker, which starts from managing that particular house or community to renting to buying to reselling, to cleaning to painting to moving to rent payment to whatever it is, that is what will happen and NoBroker.

 

So it’s a big market. We are just in six cities at this point of time. In the short term we should be at least in 15-20 cities, longer term in India in 50 cities and because it’s a technology based solution and the problem exists outside India also if you go to Southeast Asia you go to the Middle East similar problem exists. Maybe one fine day we will be outside India also. So we will be a big global giant, which helps you with every problem of real estate.

 

Siddhartha 24:58

because there’s right now nobody big in that, like technologically in real estate.

 

Akhil 25:02

Yes, nobody has done it; people have typically done it in a semi online way. So all the businesses across the globe if you see a transaction move out of the platform, and once a transaction moves out of the platform, it is not in the open.

 

Siddhartha 25:15

So going back to your days when you started NoBroker, what was the passion, or the keeda to take the leap?

 

Akhil 25:23

Keeda was that. So I’m a chemical engineer, okay. And I like to do things which make people happy. So even in my college, I was General Secretary of my hostel. We used to do things which made people happy. Then I started working with Oracle. Just because I didn’t get a general thing, which I’ve even I didn’t know what I wanted to do. So I wanted to do an MBA also. But then I came to Oracle, and the first three, four months were all about learning, learning how technology works. And I started loving it. So for the first five years, when people were just moving around, I was just working with Oracle learning how to do things. And when I was building products, it was going out. It was such a fabulous feeling that you build something, you write something and it’s on the UI and it’s working. After that I changed. I moved to a small startup where Amit, I had a twin brother from IIT Bombay, he was working there. And I saw that working in a small company was so much fun. I worked there for 2 years.

 

Siddhartha 26:27

What was the company?

 

Akhil 26:28

It was a company called Authorea. It became Fluent, they were in HRM is domain, they were doing compensation and performance management software. We used to compete with SuccessFactors. So it was fun, then that company winded up in India, and they said they want to move back to us. And I think they chose 5-10 people that you also came up with so they asked us, my brother Amit Sharma, why don’t you join us? And I have never ever wanted to go out of India. It’s my belief, I can say my belief in India since birth, that’s another thing. But other than that I’m so much attached to the land, to my family that I want to be as close as possible to my family. I said no. Went back to Oracle. When I went back to Oracle, it was a shock for me. It was such a dull feeling. You know how big MNCs work. You’re doing something, nothing’s happening. And I got into some kind of depression. And as it was, this is not what I’ll do, I will not work for anyone. So either I have to do an MBA, and I have to move out or I need to do something else. Obviously I worked in Oracle for two years. But that is the day I decided I need to do something I need to take control of my life.

 

And one day Saurav was running the chain of spa for fountain spa as an entrepreneur earlier. So he used to keep coming to my house. Whenever he’s in Bangalore. And one fine day we were discussing this idea. I just told Saurav I’m bored of this corporate life. I’ll do an MBA again, or I’ll do something of my own so he said let’s do this. And the idea was, what would happen? I know Tech, I know products. I know how to build products, that much confidence I had so I knew I had always worked on the b2b side. I said let’s build this. If not anything I’ll learn and it was a trend there at that time that a failed entrepreneur has even more value, so Saurav was like even if we fail we’ll get a job again. And even a better job.

 

And my wife, so we were expecting a baby so my wife was in the third or fourth month and at our place you go back home. In Rajasthan it’s like the first baby should be born at home only, and we didn’t want our baby to be in Bangalore. So my wife was going back for 6-8 months, so I got an amazing time. I was all alone. Monday to Thursday I used to be in the office. I told my managers, Friday I’ll not come to the office Friday Saturday’s Thursday night to Sunday night I used to code, Monday morning back to office so 4 days we would do that, 3 days this.

 

Siddhartha 29:05

Like moonlighting.

 

Akhil 29:06

Yes I even told this to someone. But you can say I’m against moonlighting so that was a different kind of moonlighting actually where I had told my manager that I’m doing something and I never let my work even in Oracle support for that particular thing so it was freelancing. So that’s how it started. We thought we would learn something.

 

Siddhartha 29:29

And when did Amit get involved?

 

Akhil 29:30

Amit joined after sometime when me and Saurav started. And within a couple of months we said we need one more person so we spoke to Amit. We spoke to many people, Saurav spoke to Amit. Saurav is from Meerut, Amit is from somewhere in UP, sometimes he says Meerut, Sometimes Gonda, let’s say he’s from Delhi. Amit came to meet me in Bangalore, and I think from day one, we had an amazing chemistry. I knew Amit beforehand, Saurav would tell me about him. I know Saurav from IIT, I think 2002, it’s been 22 years knowing him. Saurav and Amit Know each other from 2002 they knew each other for 20 years. I know I mean for I think at least 13,14 years, three of us bring in complementary skills. I take care of tech products, Amit takes care of operations, Saurav takes care of marketing. Personality wise, we are different. Very, very different. So we were like made for each other and three of us felt extremely comfortable in each one of the companies and the mission started.

 

Siddhartha 30:40

But did you ever feel, because you had seen funding from outside the three of you being first time entrepreneurs, did you ever feel that you’ll be able to raise funding?

 

Akhil 30:48

Initially, in 2013-14 when the term sheet came from March 2014 to December 2014 and the money came in February 2015, in those 10-12 months the first 3,4 months passed away in excitement, you are talking with every VC, no VC says no, everything is good. Even you would be doing this, nobody gives real feedback. But when the housing money was raised and people said we will not do it so it felt like what would happen but it didn’t feel like nothing would happen. Obviously if I go back 10 years and see what was there in my mind, but once or twice it happened that one of us got scared. Maybe I got scared but we said okay, let’s continue to do it. A failed entrepreneur is valued more so at max we might fail. After that it has been a smooth journey because of our way we have executed. It happened once that we were running out of cash after Series B but we were able to raise.

 

Siddhartha 31:54

And which alphabet of funding is going on right now?

 

Akhil 31:56

Right now it’s E, I don’t know, it becomes whatever you write on the papers, we thought two rounds to be D, what difference does it make, it doesn’t matter.

 

Siddhartha 32:08

But now you’ve reached that point where I don’t think you need to raise funds.

 

Akhil 32:11

Most likely we wouldn’t need it. Because as I said we have more than $200 million in the bank. We are going so I don’t think we should need money. We might need it for a serious fast expansion but otherwise we are settled.

 

Siddhartha 32:29

But it takes 10 years to build the base of a startup. People don’t understand it in the beginning, maybe you also didn’t, you took the step out of passion and then kept moving step by step.But 10 years is a long period of time. I think most entrepreneurs don’t realize it takes 10 years to build anything meaningful.

 

Akhil 32:49

This is the fact, no business is built in 4-5 years, in fact, I tell it to a lot of VCs also who want an exit in 4,5 years saying they didn’t make profit, you are wasting the investor’s money. Boss you invested your money for this only, one out of your 10 companies would work out. So it would happen, but it would take 8-10 years. LAnd in India maybe if you see tailwind is now with digitization, with the internet coming in with our per capita increasing people getting well off people are ready to pay for services. As our cities are getting urbanized you are getting paid correctly you will pay for anything not for the luxuries people are paying for 10 minute delivery also not correct. So it would take some time, even for the market to mature, anything would take at least 8-10. I think if a thing goes up very fast it comes down fast too.

 

So it has happened recently that people have reached where they are. I wish them best that they remain there but they could also come down. So it takes time. We didn’t know if you asked me why we took the bet, so sometimes not knowing is a blessing in disguise. We didn’t know a lot of things, how to raise funds, if there’s competition the investor wouldn’t invest. When we started, every investor in India had taken a bet on Proptech. We got to know this when we entered the system and spoke to people that Yes I’ve invested in India property, India homes, 99acres, Magicbricks bricks. The space was very crowded. So not knowing is sometimes a blessing. You can’t plan what happens after 3,4 months.

 

So you can work in your present and maybe you can work for another quarter to quarter in future. If you ask me if I knew in 2015 that Maybe you will be such a big company, I didn’t know it. You ask me where we will be? I’ve told my ambition that this is what we want to do. How we do it, whether we’ll be able to do it when we do it. I have absolutely no idea. We can try. We will work hard and then see what happens.

 

Siddhartha 35:13

A good thing about you is you stick to a city for long. You started in Bangalore and gave 4,5 years to it.

 

Akhil 35:21

We did Bangalore and Bombay in 2014, after that in 2017 we opened two more cities and stayed there for 2-4 years. We launched Hyderabad and Delhi in 2019. And then covid came for 2 years. So Hyderabad and Delhi are extremely new markets for us. So typically it takes 2.5-3 years for a city to mature and build a sufficient mass.

 

Siddhartha 35:47

And it has never been your approach to enter a city and spray.

 

Akhil 35:53

It wouldn’t work. I am not into food delivery, but the thing is if you see NoBroker it’s a c2c platform. Equilibrium is the key here. If there’s a lot of demand and no supply then one would be unhappy and vice versa. So our WM, word of mouth where happy customers are free marketer, that won’t happen here if there’s no balance. It’s not Technically or practically possible, I don’t have the power to bring all the restaurants together and then give a huge discount and capture the market. I don’t have the liberty. I don’t have such a business model, that business model is also good but I don’t have that liberty. I’ll have to be very cautious to maintain the balance.

 

Siddhartha 36:42

But I think I’ll appreciate the awareness of this thing, everybody thinks that if it’s a consumer company then run like a rocket.

 

Akhil 36:51

We will run, we are still running, I mean when you’ve made a wheel and people are adding to it fast but you’ll have to give it time. It’s a car’s accelerator, either you buy a Porsche, where you fill the petrol, press the button and it starts running, or you buy a decent car, press the accelerator, it will move slowly but I’ll move fast from 100 to 200. So it’s about zero to one whether you want to do zero to one extremely fast or you want to do one to 10 fast. Like in Zero to one you’ll learn, make a playbook and then replicate it. That is what we have done and it has worked for us may not work for everybody.

 

Siddhartha 37:35

But yeah, what I appreciate is you built a solid base and now you’re expanding on that base.

 

Akhil 37:40

We have like 2.2 crore customers who have used us. They are by far the largest if there is an owner, when did the owner buy the property for the first time, at what price was it rented then, and then the second time, third time, so we have become an MLS in India. We have so much information that we can do the price prediction. We can predict how much time it will take for the property to get rented out. Nobody else can do it. That’s the power of technology.

 

Siddhartha 38:05

So from the real estate data in bangalore, like everybody is saying the rental prices have moved up by a lot. What has been the reason for it and how much by far it has moved. And will it keep moving?

 

Akhil 38:19

Three things have happened, COVID happened and everybody went back and thought this is the end of the world. And thought that this is how the world will be now. Then the prices fell like anything. When COVID came, nothing happened for 2 years, no construction took place, there was no supply which came up. Within the first six, seven months of COVID people realized this is an opportunity to be digital. And the way money started coming in India. Everybody started hiring. In the last two months it has been like Boom of hiring. If they used to hire 1 person, they’ve hired 1.5-2 people. So in two years, supply wasn’t added, but more people were added to jobs. Lockdown was removed and everybody started coming back. Automatically demand went up. Those who lived at home in COVID, millennials, Gen Z , they used to think rental is the economy. We won’t buy a car and will travel in Ola, Uber, stay in our houses, and not even in houses, we spend our time in office, in pubs and all those things so they were not worried about what sort of house they would live in.

 

Then suddenly people realize the value of a house, one good house in a good gated society, because in lockdown it was such that if you have amenities, you can go and play squash, badminton but you cannot step out. So automatically this became a factor because of which demand for gated society went up. And when there would be 4 people for 1 house, automatically demand would go up. In good societies, gated societies and above that in Bangalore and other cities, the way that government works, there’s no infrastructure, there’s no visibility when the infrastructure would be there. People realized they can’t travel 2 hours in traffic, Ola, Uber disappeared. Taxi fares were so high so people said it’s better to stay closer to the house. So if you see the houses near the hubs of IT, the prices have gone up drastically. To give you the number it has gone up by anywhere between 40% to 80%. The house that would go for 20k would now easily go for 40k.

 

Siddhartha 40:40

Just in one year.

 

Akhil 40:44

Yes it has happened recently, in 2022 after January and February. There’s been a 30-40% increase in rents easily.

 

Siddhartha 40:54

And what’s the trend for next year?

 

Akhil 40:55

It’ll stabilize now, obviously when the economy hopefully there’s no downturn but what we see globally people are starting to fire. There is an ease which is coming in, in terms of the salary Irrational numbers may fade away or a lot of supply which will come in. It’s been one year that the supply is so automatically demand supply, the unevenness will try to calm down. Rentals will not go down, but it will not increase at this pace.

 

Siddhartha 41:34

Similarly housing prices.

 

Akhil 41:36

House prices have also gone up drastically because of the same reason but demand is very high. Even now the demand is good. Not extraordinary that you’ll start getting irrational value. Because India is growing and the way India will be in the next couple of decades to come. Housing, “Roti, Kapda, aur Makaan” are very important. There will be an increase, decent increase will be there. One step change has happened and it will be there now.

 

Siddhartha 42:04

But if you see global factors, recession, war china, will they impact the Indian Housing Market?

 

Akhil 42:13

There would be an impact, but if you see across the globe. Money’s there, VCs are sitting with money, you know better. And which is the place where people can invest? China people can not invest Correct? In the US there is recession. Which is the single biggest economy. We are 1.4 billion. We will be the single largest nation maybe in the next three, four or five years to come. China is closed, 140 crore people are there in our economy. The way we have shown in the last 10 years the things the companies have grown and the businesses have improved, not only the startup I’m talking about the infrastructure you go to, there are amazing roads there.

 

There’s so many projects which are going on so money has to flow in India. It’s like you’re running in a very long race, people have stopped to take rest, and will start again.

Siddhartha 43:20

But you think there would have been a lot of progress in 2030?

 

Akhil 43:24

A lot, and I’m super optimistic. I used to feel that the next 10-20 years are of India. I think our kids, the things that we have seen, like it happens that our parents will tell us they used to study under the light in their time. We tell our kids that you guys are so privileged. But I’m sure that the next generation will be even more blessed in India when they are born. They will be even more blessed in India.

 

Siddhartha 43:47

Your parents aspired that you go to IIT.

 

Akhil 43:54

No they didn’t

 

Siddhartha 43:55

But still, you must have picked it up from somewhere, you also wanted to do MBA also, you would have picked that aspiration from colleagues, friends or classmates to go abroad to do an MBA. Do you think your kids will have the aspiration to go out of India to study because they have to?

 

Akhil 44:15

This is one question which keeps going in my mind and I’m so puzzled, because the person I am I want everybody to be close to me. It should be one big family with everyone living together but the way things are happening and because I think in our generation I’m sure we belong to the same generation. In India everyone was middle class or lower middle class I think. My father was a businessman. We are three brothers, a twin and one elder brother. One thing which we knew that all three will not fit into this particular business and in the middle class everyone would ask you to study so that you could do something. My mother would say, “ padhogey, likhogey to banogey Nawab. Khelogey, kudogey to hogey kharab”, now even that’s not there. So because of that, IIT came as a surprise. We are from Kota. Kota is educational hub coaching hub whatever you say but when we did it, it wasn’t such a big deal. Bansal sir used to teach 14-15 students in a room. He would take a test in which 2500-3000 students would go out of which he used to select 60-65 students.

 

So someone told us about this test, we gave it and all 5 of us got selected. So we thought we knew something. I personally knew about CPMT, RPMT. RPMT was the Rajasthan PMT, CPMT the central PMT, likewise there were UPPET etc. but I didn’t know what is why there is nothing called CPET central PET, so someone told me that’s IIT, so I was like I’ll go for this. That is how we got into IIT. And I think it’s the same. Our kids, I don’t think they’ll ever be, I hope but I don’t think they’ll be able to crack any competitive exam with the zeal and enthusiasm and the hard work which we had because competition is cutthroat. Competition is cutthroat. We met IIT Bombay director a couple of weeks back here only in the park. And one question I asked him is that now seats have increased. In our time there were 2500-3000 seats, now it must have increased, what is the composition of people?

 

In our time, students came from towns like, Kota, Jaipur, Meerut. Now they come from even more interior villages. The reason being that the underprivileged, whoever wants to do something they will do hard work. And because education has reached to the roots via ed tech, whatever is happening, it is enabling every single child in India. So competition is amazing, whoever has more hunger, more thrust will excel. So I don’t think IIT would happen. In cities like Bangalore it’s a fashion that everyone would get into international school and eventually they take the easier route which is getting into one of the universities outside India. That is a trend which I’m seeing when my daughter is eight years old. I hope in the next 5-10 years things improve. India has many more universities so that they can be here and I hope it will happen.

Let’s see, but this is the trend in the cities, and I’m sure it used to happen. I guess we didn’t get the exposure when we were in 10th 12th or our parents never got exposure in cities like Meerut and Kota, that you can even send your child out of the country to study. One is because of money and second, because they didn’t even know that something like this happens. I think exposure is different in bigger cities and smaller cities.

 

Siddhartha 47:52

But if students go out to study, they’ll also settle abroad for at least the first 10 years of their life, then the question comes back, will India have the best brains built in 2020 right now in 2030?

 

Akhil 48:03

I think that won’t happen, Brain drain, if you talk about 90s Every single IITian from India went out of India. But that has stopped now to a larger extent. From our batch it started reducing , it used to happen in the senior batches, either you’ll go out do MS and then do a job, because there were no jobs in India. Now we have good high paying jobs, like people getting out of IIT at a crore package, you can add any froth in it, but still a good IITian from a good college they can easily make two lakh rupees per month, which is not a small money if you talk about US, there was no inflation and salaries are still 96k-100k which has now become 80 lakh rupees. You can compound it, factor it, and it would come down to 10-15 lakhs in India.

 

So Salaries are good. When everybody starts going out, I don’t think India will ever have a shortage of talent. We are talking about the privileged people, but still if you see in India we are way below the average income in terms of the world, not everybody will be able to afford it. So if people go from the top, people would come from below, there’s a lot of human resource. So I don’t think we will ever have this problem.

 

Siddhartha 49:38

Thank you so much. It was fun discussing with you Akhil. We went from NoBroker to discuss How things are evolving at scale in India. What does 2030 look like? Because every IITian wants to be an entrepreneur.

 

Akhil 49:52

Yes, that’s the problem.

 

Siddhartha 49:57

That’s a good problem to have.

 

Akhil 49:58

A good problem to have, So we consistently go to IIT for hiring since 2015. We are going, the way CVS has changed. When we were there, what we used to write was becoming the general secretary of Hostel, that was a big achievement. It’s a great extracurricular activity. Based on that companies will shortlist you and you would love it. So this used to happen, I lead a multi-team of 30 people to do this particular thing, now you go to the campus, you’ll see the Founder and CEO, and that too two times, they would have already started. So one of my distinct cousin I was talking to and he’s not from IIT, so I was saying now you would have gone back to do the job, you’re working in Delhi. It’s been 6 months. Do you go to the office? So he said yes I do, I am supposed to. I said You should go because you guys are like the junior most and you need to work, how else will you learn, so he said no, we’re seniors. I asked how, he said we look over the kids, I asked how. He said, I have 3 years of experience, I worked 2 years in college.So that is how it has become, a good problem to solve. Definitely.

 

Siddhartha 51:09

Thank you so much again.

 

Akhil 51:12

Thank you and I think it’s been 40 minutes and I didn’t realize. I love to talk.

 

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