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How 99Acres plans to use the $120 million it has raised

99acresThere was a sense that Info Edge* had become a one trick pony, and its businesses was restricted to primarily the business that its stock ticker symbol is named after: NAUKRI. That recruitment business still accounts for a majority (around 72%) of its revenues, and in the past, we’ve questioned them about why they’re still persisting with Jeevansathi, which has been at number three in the matrimonial site segment for a few years now. Someone even said to me a few months ago that growth for Info Edge is only going to come from its investments, which include Policybazaar, Zomato, MyDala, MeritNation, among others.

Info Edge, it appears, has other ideas. Among its businesses, 99Acres is one it has appeared most bullish on (if you go by the concalls), and we see the the recent fund raising of Rs 750 crore (around $120 million) as a strong statement of intent that the company isn’t willing to let competition take away marketshare.

Both 99Acres and MagicBricks.com (owned by the Times of India group) claim to be leaders in the online real estate listings space (and disagree on who exactly leads, based of different interpretation of traffic data). Those challenging their joint-leadership include

– CommonFloor, which has raised around $40 million this year, in two rounds of funding: one, two.
– Housing.com: which raised around $18 million a couple of months ago.

Now that the funds have been raised, Info Edge has issued a communication to its shareholders detailing how it intends to use these funds (pdf):

1. Hiring:

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– Senior Hires: Info Edge says that they’ve recently expanded the senior management team at 99Acres with two hires in “Operations, Search, Analytics and New Homes.” The company says it will look for good senior leadership talent and will add a few more people to the team in the future.
– Product team: has grown from 50 a year ago to 125 people in “engineering, design, product, analytics and quality assurance”. They intend to expand this team further.
– Sales: 99Acres has 600 people in sales in across 20 cities. It intends to expand this team in the coming months.

2. Improving listing content:

– Expanding coverage: The company is targeting another 15,000 new projects / “ready to move in societies” over the next few months. It has over 13,000 new projects and over 23,000 ready to move in societies on its projects platform”, it says.
– Increasing owner listings: the company has over 550,000 active listings, posted in the last two months. Of these 1,20,000 are owner listings. It says that the “proportion of owner listings is likely to increase in the coming months.”
– Adding rich content: It also says that “over 7000 important projects and ready to move in societies now have high quality videos or photos.”

– Verified listings: have been rolled out in Chennai, Hyderabad, Kolkata and Pune in the last 3 months, taking the overall coverage of verified listings to seven cities. They plan to add more listings.

3. Business / Operations:

– Call center: A call centre has been set up to verify leads.
– Lead distribution system: 99Acres introduced the first version of its lead distribution system in the market this month, offering a free trial to its top clients.  “We plan to roll out a superior version of this product and go paid in the coming months.” In addition, the company says it will “continue to invest behind dealer/builder workflows to help our clients in servicing leads better. We have recently enhanced the functionality of response manager and plan to continuously improve it going forward.”
– Mailers: “We continue to work on improving the efficacy of our existing paid products. Superior mailer targeting along with better analytics to help us fine tune responses for our customers in line with what they have paid continues to be an area of investment for us.”

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Info Edge says that around 7,000 customers use its premium offering, and it will now focus on expanding its paid customer base.

4. Product Plans:

– 3D Modelling: Info Edge says that, a few months ago, it acquired a design studio that has “developed proprietary technology for 3D floor plans and walkthroughs” That team has been integrated into 99Acres. Around 30 new projects on its site now have 3D plans. “We plan to increase this coverage to several hundred projects over the next few months.” Some deployments here and here.
– Improving Search: “Improving our search experience is one of our top most priorities.”
– Website:  The site will be made less cluttered and more visually appealing, with a focus on improving navigation and create higher quality advertiser inventory online. On Mobile, 20% of 99Acres traffic is from the mobile site, and 9% from the app. The plan is to redo the mobile apps as well.
– Resale, rental, New projects platforms: the company is investing behind customising the experience for resale, rental and new projects, given that each customer comes with different expectations from 99Acres, “in terms of information quality and expected time to close the transaction.”
– Map search: “Version 1 of our map search is planned to go live next month. We have already started working on the next version.”

– Improving recommendations: The company says it has improved its price trends section and extended it to new projects and rentals, apart from introducing builder pages to give an indication of a builder’s track record. It intends to expand features to include “similar properties and projects and other search recommendations.”

5. Marketing: The company has increased its investment in performance marketing and TV advertising, with competition increasing. It intends to continue increasing spends.

Disclosure: Info Edge is an advertiser with MediaNama

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Written By

Founder @ MediaNama. TED Fellow. Asia21 Fellow @ Asia Society. Co-founder SaveTheInternet.in and Internet Freedom Foundation. Advisory board @ CyberBRICS

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.



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