How NoBroker is rewriting the rules of the real estate market

To understand if NoBroker has been able to disrupt the Indian real estate market, rewind to 2015. That was when a group of 50 brokers barged into the then one-year-old startup’s office in Bengaluru, destroyed its gadgets and assaulted its employees.

The brokers were miffed with NoBroker for destroying their livelihoods by helping potential home buyers and renters avoid the middlemen and eliminate brokerage fees.

Fast forward to May 2022, and NoBroker, which became India’s first property tech and real estate unicorn last year, has set its eyes on loftier goals such as helping customers save Rs 3,000 crore in brokerage fees this year, turning profitable in two years and taking its services to 50 Indian cities over the next five years.“We’ve just scratched the surface, there’s a long way for us to go clearly, as the market is huge,” NoBroker’s co-founder and chief business officer, Saurabh Garg, told DH.

The startup, which has helped customers save Rs 7,000 crore in brokerage fees since 2014, said Indians typically pay brokerage fees worth Rs 1,40,000 crore each year.

Show me the money

So how does NoBroker make money?

The peer-to-peer real estate portal makes money mainly through subscriptions, financial offerings and home services, Chief Executive Officer Amit Kumar Agarwal explained.

NoBroker subscriptions, which account for most of its revenue, are priced at Rs 999 for 45 days, and allow clients to use premium filters while searching for apartments.

“The revenue mix is equally distributed among buying/selling and renting,” Garg told DH. “Typically a person will rent five to six times before he/she buys a house.”

Once it acquired a steady client base, NoBroker dipped its toes into financial services and got paid by the banks every time it helped a client secure a loan from them. The startup also offers home services such as cleaning, packing, moving, offering furniture on rent, doing home interiors and taking care of online agreements. It also runs a service called “NoBrokerhood” that helps people in gated communities stay connected and manage their visitors.

“The focus of these companies is to add more value-added services and as long as they are able to monetise them, they will continue to keep disrupting the traditional business models,” said Akhil Saraf, Founder & CEO of real estate digital amenities provider Reloy. “The future for digital-age proptech companies is to provide full-stack services to customers. As of now, it’s very early since continuous revenue needs to be generated to create a level playing field.” NoBroker, which counts General Atlantic, Tiger Global, SAIF Partners, Beenext and Paytm founder Vijay Shekhar Sharma as its investors, has 1.6 crore registered users across Bangalore, Mumbai, Pune, Hyderabad, Chennai and Delhi - NCR.

It has 75 Lakh properties registered on its portal and does transactions worth Rs 3,000 crore every month. It competes with the likes of Stanza Living, NestAway, Quikr and Zolo. “Because there is a tech advantage, these players are taking away businesses from traditional brokers where they know how to execute the deal,” Saraf said.

The road ahead

NoBroker saw its revenue from operations jump to Rs 63.34 crore in FY20 from Rs 18.08 crore in the year-ago period, according to Entrackr, but the growth has come at a heavy cost.

While the startup was profitable in Mumbai and Bengaluru, the startup as a whole will take “about 18-24 months on a variable basis” to turn profitable, said Agarwal.

The rental property market as a whole is booming in India and has received over $1 billion in the last five years with close to 400 rounds of funding, according to data from Crunchbase, a platform that provides insights on companies.

NoBroker now wants to get ahead of its competitors by wooing EV users. It has partnered with ElectricPe to set up over a lakh electric charging points in residential communities and with EV maker Bounce to provide battery-swapping services.

And it will keep adding such services. “Many of these services have come because the customer asked for it, so I think a lot of those things will keep on happening,” said Garg. “We want to be a one-stop-shop.”