Real estate and apartment management portal CommonFloor has acquired a controlling stake in the student accommodation portal Flat.to for an undisclosed amount in cash and stock.
Through this acquisition, CommonFloor is looking to enter the student & bachelor accommodation segment. CommonFloor co-founder and CEO Sumit Jain informed that Flat.to will continue to function independently with Flat.to co-founder and CEO Gaurav Munjal heading it.
Note that CommonFloor currently doesn’t have an offering for the student market, there it makes sense to acquire an existing company rather than start from scratch. This also gives CommonFloor an experienced team in this space.
Flat.to’s other co-founder and investor Aakrit Vaish has however exited the company. Note that Vaish had launched another company Haptik last July which allows customers to chat with company experts for tech support among others and he was not involved in Flat.to’s day-to-day operations.
Flat.to was founded by Gaurav Munjal and Aakrit Vaish in 2013 and allowed students and bachelors to search for flats, hostels and paying guest accommodations based on the locality or college name in six Indian cities including Mumbai, Pune, Bangalore, Kota, Jaipur and Delhi.
The company claims to have tie-ups with 200 colleges and provides an option of selecting accommodation either through brokers or directly by connecting with owners. It also allows users to search for flat mates by listing their flats on the service. The company claims to currently have 7,000 listings on the site.
Why Flat.to chose CommonFloor acquisition
Speaking to Medianama, Munjal said that they were looking for a new round of funding to expand into more cities when the merger proposal with CommonFloor came up. When queried why they chose the merger, Munjal said this deal will allow them to access CommonFloor’s huge inventory and users. They plan to use the company resources to expand to at least 18 cities by the end of the year and reach a one million member mark.
Munjal has relocated to Bangalore to setup and manage the company’s new office in Bangalore, where CommonFloor is currently based. He is currently hiring employees for this office. Flat.to’s Mumbai office has retained all its employees and will continue to function as earlier, Munjal added.
Jain said when they raised Rs 64 crore Series D funding from Tiger Global and Accel India, an acquisition wasn’t on their roadmap since they believe in organic growth. They instead had stated plans to invest the funds in company expansion, technology & marketing initiatives. However, they have been mentoring Flat.to for about 4-5 months and realised it was a right fit. Jain also noted that though they are both in online realty space, they weren’t direct competitors as they served different markets.
