Scaling TheHousemonk in India’s Messy Real Estate Industry: Scaling journey of Ajay from TheHouseMonk

Cover Image for Episode 39: Scaling TheHouseMonk in India's Messy Real Estate Industry
Scaling Journey of Ajay from HouseMonk

India’s messy real estate industry

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In this episode which covers the scaling journey of Ajay from TheHousemonk, we discuss the state of India’s real estate industry and the opportunities.

Owning a home is everyone’s dream. In fact, the housing sector has contributed to much of the economic growth in the west and in the developing nations. Unsurprisingly in India as well, over the last two decades, much of the growth has come from the housing sector. Managed by the local govt, the housing sector is anything but in a desirable state.

Chart depicting the growth of India's Real Estate Market
The Ever Growing Indian Real Estate Market

The chaos that permeates the Indian landscape can be vastly seen in the housing sector as well. An interesting fact here to note is that about 80-90 percent of cases pending in the Indian courts are property-related. This is because of the disorganized nature of the Indian property landscape, the documentation and legality associated with it along the rudimentary nature the sector operates in.

While the sector has several large names such as Brigade, Prestige, Hiranandani, DLF, Sahara Group, and other respected names also have had a messy growth story. Given this scenario how does one scale a housing company?

Image depicting various Indian Real Estate industry segments
Indian Real Estate Industry

Listen to the scaling journey of Ajay from The HouseMonk in the Indian housing sector.

How Ajay started TheHousemonk

Ajay was a Newly mined graduate at MuSigma, one of India’s premier Unicorns in the data analytics space. On a fine day, while house hunting, he is bewildered by the commission the broker makes for the little value that he added.

Unlike most renters, Ajay felt that getting compensated disproportionately compared to the value he added. He takes a deep dive and 2 months later, quits his high-paced and exciting job to found HouseMonk in 2014.

Knocking on the doors of scale

HouseMonk currently has over 100,000 properties managed thru its product. They are pushing the levers of scale in the housing sector with their product. The journey thus far is interesting and full of ups and downs.

A fascinating listen about the scaling journey of Ajay from HouseMonk in the Indian housing sectors.

Scaling Journey of Ajay From TheHouseMonk

Here are some excerpts from the episode. Listen to the whole episode for the full scoop.

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Scale journey so far

I think we’re touching 100 clients at the moment, or maybe we’re just a little short of it. But that’s the broad ballpark we were at. So we’ve grown about 250 percent this year, from start to finish. Ideally, we were shooting for about 400% growth this year. But then COVID had other plans. But we’re still happy with you know, where we got this year to 50%.

Ajay 1:40

What the initial idea was

Our initial idea was to potentially give a very end to end solution. The real pain point, which very ironically, still exists today, seven years later, is that there were a lot of property portals and real estate aggregators, but they just show listings. They don’t take account of enabling the transaction, which happens offline, typically directly with the landlord, or, in most cases with the broker as well.

Ajay 7:00

Why did the pivot happen?

We had a reasonably big tech enabled property management business, called Cozyhomes. It was going reasonably well. Not much to complain. The business was actually profitable, it was growing about like 10%, on a bad month and about 20% on a good month.

It was going fine, didn’t really have any problem with it, but was not scaling as quickly as what our aspirations wanted it to. And primarily because there was an offline component.

Ajay 39:57

How to think about building a team

At an early stage, when you’re still finding product market fit, I think you should not have more than three engineers in your team. Three good engineers, and one product designer should be your initial team till you find product market fit.

The only reason I say that is maybe it’s four, maybe it’s five, but it’s not 20 engineers. And I see quite a lot of Indian companies, you know, who just keep scaling number of engineers that quickly, you know, what happens is that when you have a lot of engineering bandwidth, you start building features that might not be present.

Ajay 1:02:06

Watch On Youtube:

You might like this episode where another entrepreneur took on an Old World problem to Startup: Isaac Wesley of InkMonk: Season 1, Episode 46

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WordCloud for Episode 39 : Scaling Journey of Ajay from TheHouseMonk
Word Cloud for this episode

Follow Maharajas of Scale On Twitter (@maharajaofscale)

Ajay is on LinkedIn here: @ajaykumar

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Episode Transcript

(Automated Transcript)


broker, bangalore, real estate, build, product, companies, point, customers, property, started, home, market, industry, cities, manage, good, business, transaction, buying, put


Ajay Kumar, Krishna Jonnakadla, Tania Jadhav

Krishna Jonnakadla  00:01

This is Maharajas of Scale, a podcast where we go behind the scenes and talk to founders who are demolishing the myths around building and scaling a big business in India. These are the stories that have shattered the assumptions around Indian consumers and of changing the game completely. I am Krishna Jonnakadla, serial entrepreneur, co founder of FLIT the fashion located in town and startup mentor, bringing you the stories. Everyone Friday afternoon still cloudy and little drizzly in Bangalore. Today we have Ajay of House Monk, a sector that is very close to my heart. And you know, if well managed, can be can be the one sector that will put India on the $5 trillion economy map. For some reason, you know, we all choose to just keep playing around with it. But Ajay is doing some phenomenal stuff. And let's see what he's doing all the magic he's unleashing with house monk idea. Welcome to the show.

Ajay Kumar  00:57

Thank you so much. And I'm very happy to be here today.

Krishna Jonnakadla  00:59

 Awesome. So Ajay, tell us a little bit about yourself and what you're working on right now.

Ajay Kumar  01:03

All right. So the House Monk is essentially a prop tech startup, we are in the vertical SaaS space. Broadly, we're building technology and software for the real estate industry. Our focus right now is primarily to help the rental industry within real estate. So this includes polling companies, property management companies, private landlords, co working companies, anyone who's taking a piece of real estate, and doing something with it, right. So we help them with a very end to end solution, right from helping them market their properties to not getting bookings, streamlining operations, managing their finances, so on and so forth. So very, very full stack solution. For this industry. We are global in nature. So being a SaaS company, like we're not really focused on one particular country or one particular market, we have close to about 100 clients now spread across about 12 countries at the moment, and scaling very quickly.

Krishna Jonnakadla  01:52

What sort of scale have you achieved so far?

Ajay Kumar  01:54

So close to about 100,000 rental properties, while managing ecosystem. This is coming from abode. I think we're touching 100 clients at the moment, or maybe we're just a little shot of it. But that's the broad ballpark, we were at. So we've grown about 250 percent this year, from start to finish. Ideally, we were shooting for about 400% growth this year. But then COVID had other plans. But we're still happy with you know, where we got this year to 50% in a COVID. Here is phenomenal man. And so that's one of the things that we're most excited by because April, May, June for us was really bad, right? Like, we could not sign anybody, I think the entire world went into paralysis, everyone really wanted to see what's going to happen. And what really happened, I think after that, after the pandemic was that there has been a rush of small businesses investing in technology. I think real estate as a sector has been very averse to using software, right, it's one of the slowest adopters of technology anywhere in the world. And what we are noticing now is that a lot of inbound requirements are coming in, right, so two things, the number of requirements coming in are a lot more. And the stage at which these requirements are coming in are a lot earlier. Right. So typically, unless you hit maybe one, two, maybe $10 million in annual revenue, you know, as a real estate business, you don't really think too much about software, right? You can just run your business using Excel sheets and you know, Whatsapp groups and animate some kind of a setup. Um, but people are adopting software much earlier in the cycle, which is, which is very heartening to see. So we're seeing a lot more companies adopt software, and they're adopting it a lot earlier in the life cycle as well. There is a small chance that COVID was actually you know, a blessing in disguise. So that's what we're hoping for, we'll get to known in the next twelve months.

Krishna Jonnakadla  03:41

I'm certain it is when, because many times it's hard to and to paraphrase the famous Steve Jobs, it's hard to connect the dots looking forward, but it is always easy to connect them backwards. But let's we'll get into that a little later. But tell us how you started off as an entrepreneur, let us get to know you a little more.

Ajay Kumar  04:01

Okay, so I've been an entrepreneur almost seven years now. I started when I was very young, I was 23. I had just turned 23. Or maybe I was just turning 24 when I had actually started my entrepreneurial journey. I was earlier working with this company called Music Business Solutions. I was a business analyst, I was helping fortune 500 companies make better decisions through their data.

Krishna Jonnakadla  04:23


Ajay Kumar  04:24

As fate would have it. I was shifting houses. I engaged a broker, I paid him a lot of money at that time. And I really felt this guy does not deserve this much money, right? Like he showed me two houses. He did like, you know, like a simple rental agreement on a piece of paper and now he's walking away with 25,000 rupees. That doesn't seem fair. Right? And that was essentially the trigger point for me. So it's really not like I felt a thing of you know, how something is difficult and all those things. I came from it more from the perspective of Oh, it looks like a great opportunity. Because this guy who is not trained There's walking away with so much money. And he's hardly done any work. So there must be a lot of money in this. So that was basically my hypothesis. At that time, I didn't really waste too much time I spent like a, like a month, two months, you know, thinking about it, I quickly took the plunge, I put on my papers, much to the amusement of pretty much everyone surrounding me, because I did my engineering from a fairly good college. I mean, I was working in a fairly good setup, it was looking very nice and rosy at that point. So it was very difficult for people around me, like, you know, my family, my close friends, you know, even my boss, that someone's gonna leave all of this to do something in real estate. So that was, it was not that I was going to start off with the, you're gonna start something in real estate, really. So it was as if people were telling me don't get into the sector, you know, do whatever you want, but don't get into the sector. But that kind of like inappropriate me even more. And, you know, as I started doing more and more research, I realized that real estate works very differently in western parts of the world. And it simply has not percolated into the Indian market. And that was loosely what I wanted to do, I really didn't even have a very clear vision on what I wanted to do. But I just knew that I wanted to do something in the real estate space, possibly, you know, start with the broking industry. And that's essentially how I got started in 2013, like mid 2014, is when we actually got kicked off. We started off as a real estate brokerage technology company, we initially started by building software for the real estate broker industry. But once we realized that we were not getting a lot of adoption, we pivoted that to becoming a tech enabled brokerage ourselves. So we put out about 2530 real estate agents on the field, they were using proprietary technology that we built. And it was a very end to end solution, as in the software, help them manage leads, organize their inventory, you know, fix viewings, you know, help with paperwork, and deal closing. So we did pretty much the whole nine yards. And that's kind of how we got started in the industry.

Krishna Jonnakadla  06:48

Amazing. You're, in some sense, a realist realty or a real estate, the piping and the plumbing or the infrastructure play, isn't it?

Ajay Kumar  06:58

It was. Our initial idea was to potentially give a very end to end solution, right? The real pain point, which very ironically, still exists today, seven years later, is that there were a lot of property portals and real estate aggregators, but they just show listings, right? They don't take account of enabling the transaction, which happens offline, typically directly with the landlord, or, in most cases with the broker as well. Now, that's basically where the interaction, we felt there was a very big gap, right? Like you start online, immediately, they put you in touch with a broker and, and pretty much how something happens offline. And the broker is in charge of enabling that transaction, but these people are not trained. So we find that's where the gap really was. And it's super easy to gain the property portal sites of brokers, they keep putting properties which simply do not exist in real life. Even if they do exist, they don't share the location, or they don't put up the pictures. I think had a very valiant entry into the industry, like they were really trying to do something good. Unfortunately, they could not do whatever they set out to achieve. And here we are seven years later, that problem still exists, you know, you go to magic tricks, you go to no poker, you go to nine, nine acres, 50% of the properties don't exist, right. And it's such a bad experience from a customer standpoint, that our thought was, let's actually tie it into it. Right. So let's make sure that for our customers, we give a portal, which actually has active listings, which is verified by us. And we will do it offline as well, where we will send out our agent to help them complete the transaction. So the thought was bundled into an ecosystem under one roof. Initially, the thought was let's not employ the agents, let's maybe partner with existing agents so that they get a piece of technology, not just that, but they get a new way of working, right, like there are small small agents spread all over the country, these guys are not really no one's taught them how to work in an organized way. So we thought apart from the tech, let's do a little bit more, you know, let's try to put some processes around the industry, let's train all of these agents, which is actually what is really required. And, you know, let's go to the market with a full stack solution. That's how we got started. It was working, I would say, reasonably, okay. It was very difficult to convince existing agents to, to work in a radically new way than what they were used to. It was this was once again, pre geo, and you know, pre 4G and everything, internet was patchy all over the place. And as a real estate agent, you're almost always on the road, you never have access to Wi Fi. Like, that's not really a thing. So getting adoption on the app was also a little challenging. And that's when we realized that Hey, no, this might be we might have bitten off more than we can chew. And so this was about 2015. When we decided no, like, let's, let's maybe like take a pause on that. And let's maybe look at some other segments that sector within real estate itself, which might, which might lead to something of a little more consequence. And that's how we actually launched cozyhomz which was, I would say, like overtime, it was a reasonable success. We thought where we had challenges was that as a broker, you don't have control on the supply right? Like property owners come and go, like, they'll give it to the dealer to 10. Other brokers, they put it online, they will put it on their app not complex or my gate or whatever that might be. So owners don't have any control. I mean, brokers don't have any control on inventory. And if you want to give a very good rental experience to all of your customers, in that case, you need control on the subject. And that's how we launched cozyhomz. It was a very full stack home rental platform, where essentially, we on boarded properties from owners, and we decided for an owner, they're going to give you a property management solution, where we have a market your property, find tenants do the paperwork, collect the rent, take care of home maintenance, coordinate moonwalks, and we're going to do all of this for you. And if you're attending, it's a very similar solution, you know, you can see the property. And not only are we a facilitator for the transaction, we are essentially the landlord for you, that you speak to us, you booked from us, you pay rent through our app, you raise, you know, maintenance tickets through our app, and you pretty much do everything using our ecosystem itself. That's how we got started with cozyhomz. That company was a reasonable success. We did that for about three years, we managed to scale to about 1500 people were living in our facilities, and this was spread across Bangalore and Chennai. reasonably good success. So that was a very, very interesting learning journey for us. So that was the cosy with a COSI, SI No COZZEE.

Krishna Jonnakadla  11:22

 Okay. And so you, you are essentially leased out space, and you had you were going to lease it out to others. So in some sense, you will manage somewhat like what NASA does right now.

Ajay Kumar  11:32

But fairly similar.

Krishna Jonnakadla  11:33

Yes. Right. fairly similar. Okay. But

Ajay Kumar  11:36

At the same time, actually, so nice to have a Zolo Stays cozyhomz. Right. All those other companies, we all essentially started at the same time.

Krishna Jonnakadla  11:42

Right, right. So talk about what set out to do. Because the I think a lot of people went gaga over the interface and the way they presented it and that kind of stuff. But I still think some of the fundamental problems that you were talking about, which is having the same thing in multiple places. Yeah, there is no geolocation. Yeah, for some of those. In most cases, the brokers are actually miss misrepresenting information. Many of the postings are by brokers themselves, photographs are wrong, listings are wrong. And so that, so there is so much data pollution. Yeah, and for every 100 properties out there, maybe there are only three or four that are genuine. The whole purpose of these portals see is that you put two people, buyer and seller or potential buyer and potential seller in touch with each other. By disintermediating, the broker, the whole point is that, but in in effect, you actually ended up strengthening the same fellow. Yeah, who actually is not adding any value at all, he's only value seems to be that he's a robot. He's like a vagabond, and he's only strength is that, okay? He's been roaming around in this area, he's just saw a bunch of toilet boats. And he, he has this, he's put up some small store and board up somewhere saying that I'm a real estate agent. And he sort of from memory remembers that these are the ones that are available, and therefore or there are some, there are some other players right? There. There's some broker who's actually within a large apartment complex, he stationed there, and he sort of acts as a monopolist that actually controls the flow of those transactions. Those are literally thing, right. So and, and having lived in the US, I've had the benefit of I have the benefit of contrasting that system with this. Not that that is any efficient, it has its own, you know, cons, but what was so I can understand, what magicbricks 99 acres all of these people are trying to do. Yeah. And many of these places, it is there is always an effort to just build sheer listings. Yes, right. And then therefore create a search engine optimization when Okay, property for rent in a horseshoe road, and therefore you appear on top of the list. So that's sort of the real play out there, when these are being built no means suggesting that either it is right or wrong. Yeah, that's what it is. So so go digging a little deeper there.

Ajay Kumar  14:27

There are quite a few lessons right that we can take from the online real estate movement. I think magicbricks 910 acres has been around for almost 12-15 years at this point. Right? When came in. I think you could so that was the first real virality that I was exposed to this site. They really came into the market very aggressively. They had a truly good product, it was miles ahead of the competition. And you could sense it because consumers who, who actually had no relationship with housing They were rooting for their victory. Right. And we really understood that there was because there is a deep pain point in real estate with respect to identifying property and, you know, essentially doing the transaction, right. So when somebody came in with a 10 x better solution, people were super excited, you know, by that kind of a solution.

Krishna Jonnakadla  15:16

And let's dig in deep on the 10 x angle a little bit.

Ajay Kumar  15:19

So I think it was one, two, there were three main pain points that they solved today. First pain point was the fact that you could digitally tour an apartment sitting in your own house, this sent somebody to go take pictures of the property. And I think towards the end, they had like videos that were taken as well, the fact that you can sit in your house and towards the next house was a super super well, number two, you could see the exact location of the property once again, without leaving your house, if you know where exactly it is. And in most cases, people who are relocating or especially people who are buying, let's say, a resale property or a secondhand property, right? They know exactly where they want to buy, I want to buy in martelly, I don't want to Nicola, a region, I want near this coonelly signal. So people know, to that extent, right, because they've been there for a while. So if a broker tells them, hey, it's and Martha Lee, they want to know more, like we're in Marathon, right. And brokers are typically not willing to give that information. But on, you got the exact location, so you knew where you were going to buy something as well. The third big one that they brought to the table was the user experience on the product was once again, very, very good. It was not a clunky, horrible, you know, very classified ish. portal, it was it was truly web 2.0. Right. It was new in every sense of the word. They started with design. And you know, they were pulling backwards from there. So they did a lot of things, right. I think where the miss might have happened was, I mean, I think there's a lot of things that happened at a corporate boardroom level, which I don't I don't want to comment on. But I think from a business perspective, where they might have missed the Mr. bus was, they should have worked a little bit more with the broker ecosystem, then what they actually did. And let me tell you a couple of points around this thing. I'm a very genuine believer that you need to first try to empower any middleman before we even try to eliminate that middleman. So this should be option one, right? You give a shot at empowering and if it doesn't work out, you work on eliminating, I think that's fine. But it's so much better to just empower rather than eliminate, right? Like as as an option one, three. And I think that's possibly like one of the mistakes, I feel that did that they will not be listening to the brokers, right, like brokers are saying, you know, I've seen this happen right in front of me where brokers have listed properties on, but you give the location you give the pictures, it's not too difficult for people to walk offline, and, you know, go and get the property themselves. And brokers started losing very genuine revenue. And brokers were like, no, we're not gonna list on this platform, let's go back to magicbricks 9,10 acers more than anything that happened at a corporate level, I think the real reason why housing was not able to sustain was because the supply shifted back to magic bricks and entering equals, right. And to their credit, I think these platforms really understand the ecosystem very deeply. They understand first enable, if not, you can eliminate but you know, first option should always be to enable the existing business. So that's point one, right on why I feel you know,, which is even I think the first problem is finding a house. The second problem is finding a house without a broker. Right? And especially, let's say you're buying a house, you're gonna spend, let's say, maybe one crore or, or more in a lot of cases, in buying a property, I think paying 1% of that to a middleman who's going to help you identify the property, and it'll help you handle do through the deal. I don't think that's a lot of money to paint like 1% is, it's hardly anything, right? Like any middlemen, charges, like a lot more than that. And whether it's a digital middleman like e commerce marketplaces, or even like an offline retail store, like as a middleman sounds a lot more than that. So I think there is very genuine merit. Maybe brokers have not kept up with the times, they have not really adopted or evolved as quickly as they should have. Maybe they've not been given the opportunity, like very few companies have been born with an aim to enable the broker, right? Everyone's like, Oh, I'm gonna get, I'm gonna eliminate this complete line of, you know, maybe 10-15 lakh people, you know, who exists in the country. But no one's really taken a very good stab at, you know, enabling them. And I think maybe that might be a mystery for us as a society itself. But that's kind of what happened. And I think that's the reason why you still see magic bricks, Titanic is very much on top not because of what happened at housing. But because I think at a business model level, certain things went wrong.

Krishna Jonnakadla  19:24

So it's in that that's an excellent backdrop. But before getting into that 2013 at music, ma Yeah, very exciting time. Right. So I made the pledge a couple of times. In fact, a couple of years ago, I was I walked away from a role to head the central and West. Your states for music Ma. Nice. We just did it and I had some sparks. I was talking about this factory for the next five years. And it's He felt very challenged. If you've if you've seen the funny thing about music, Mize, it's the only company that has put out philosophy videos from the founder.

Ajay Kumar  20:12


Krishna Jonnakadla  20:15

And it just goes to show how highly Dheeraj thinks of himself. And it's no more no mean, what he's done is a no no mean accomplishment, right the hats off to him, he's carved out an entire set of things, but some of the Indian underpinnings and and for an onlooker, it always looks like you know, that job is so much more easier to do. And I don't begrudge what he what he's doing for even for a moment. But, but that is 2018 This is early 2018, about 2013. And by 2000. I remember 2014 NASSCOM product council 2015 data was the keynote speaker one of the two or three keynote speakers. And he did a terrific job, he still hadn't gone through his divorce back then. And Music Man was, I think a newly minted Munich unicorn. And all of those things had happened. So 2013 must have been quite hairy and exciting for you to quit musigma.

Ajay Kumar  21:20

Musigma ma, I think is definitely was I think, to a very good extent still is a very special company, I think to do what they've done within the timeframe that they have done it, I think it's it's exceptional, right, the scale that they've managed to achieve. And what was most exciting about music now was the people that you work with. And they have quite a lot of things that they do, which like, which I didn't appreciate when I was there, but now looking back at a time. So they had a very unique way of recruiting. And the rich knew that he had to recruit hundreds and 1000s of people in order to keep up with the demand that to keep up with the scale at which the company was growing. They have a very unique approach, which is go to decent colleges and pick up decent people. Meaning they were one of the few companies who said if you're a nine point or don't come for me, right, go away, eight point a Western, okay. Ideally, I'm looking for six and seven pointers, because they knew that this is basically the crowd that fit their culture very well. And they have this thing where they throw responsibility at you on day one, right? I had just graduated, I joined Mu Sigma, like literally four days after I graduated, I was put through a training of 30 days. And a week later, I was speaking to the director of analytics for an fmcg company based out of Atlanta, it was crazy that anyone would do something like this, because most of my batchmates had not yet joined. And that they will join three, four months later, they will be in training for six months, they will be on probation, they will be on the bench. It was like two, three years before they actually started speaking to clients, there was an opportunity I got so quickly. It's kind of like not throw people at the deep end of the pool and then figure out how to swim. So that portion I really, really admire about how they managed to crack that right. And when you were in musical, you could feel the energy. It's a super, super energetic work environment, which is something that you know, to their credit, they pulled off, they pulled off very, very well. I think a lot of good things out of bad things. I think the company could have done much better than where it is right now. Maybe a couple of strategic calls could have been taken a little differently. I think broadly, the company did not move to products as quickly as they should have done. They were really hoping that, you know, the services delivery model itself will sustain them for a very long time. I think maybe in hindsight, that might be something that the company should have done differently. Or if I was there, you know, I would have maybe urge management to do a little differently. But let's see, I think they're still still out there. still fighting the good fight. jury's still out on, you know, where, where the company is going.

Krishna Jonnakadla  23:57

And so the product aspect and working on it. See he revenue had fallen. Right. And the whole point was how to get back on that revenue Saturday. Yeah. And I had presented a five point plan. Yeah. And for anybody looking at it, that, especially from the strategic perspective, have you heard of palantir?

Ajay Kumar  24:24

Yeah, of course.

Krishna Jonnakadla  24:24

So palantir is a shining example. What musigma can be, yeah. But it it is because of the calls that it took. So the whole whole idea is, how do you get to that point? That was that was in some sense, obviously, you know, it would be stupid to just mimic what palantir did. Yeah, there are very original things that could be done. So anyway, I there's see I've always held the notion that let's say today, for instance, you know, this movie maker called Christopher Nolan his movie Tennant is supposed to be releasing in theaters and on streaming, I don't think he's releasing it on streaming platforms. Now streaming platforms are saying or rather, these content houses production houses and distribution houses like Paramount, Viacom, Warner Brothers, they've all been used to the average $1 $9 $10 ticket per person. So they're using the same model for Ott platforms. What happens is people who come from one world, yeah, it's impossible for them to fathom the workings of the other world. It is one of the biggest reasons why discontinuity in strategy happens. And there are very few people who have scaled that evolution. Yeah, the company can perhaps do that. But for that to happen, it has to come out of the vestiges of the original people that created a certain model, right? One exception to that is Starbucks, where Howard Schultz, who gave up the CEO job, and he thought he had he had run it for 15 years, 15 or 15, odd years, and all the other people who were in the company, were all seasoned enough to take it to the next era. Unfortunately, that didn't happen. And Howard Schultz got back into the saddle. And he still has to, I think he's still CEO, and he's doing a terrific job close to 30 years in the job. But so so then you saw the broker empowerment, are these lessons in hindsight, but when I looked up all the things that you guys had done, about enabling brokers, it's actually fabulous, because Indian brokers to a great degree, are still largely unorganized. Right? Even the very sophisticated ones are still untrained, correct. They're just because they're, you know, doing a large lease with an established Corporation doesn't mean that they're any more sophisticated, or they're any more structured, because all they're still doing is they're using maybe a little more polished English, they dress well, they show up in a nicer car. Yeah. And they are just telling us what the other person is saying. And in most cases, the model is still hashed out between the landlord and the tenant or the lessee, as the case may be. And so, so that training is so much more essential and would definitely benefit. And that itself would possibly be an amazing model, I would think.

Ajay Kumar  27:32

I think that might actually have been the bigger opportunity. Given my background and the way startup media makes you think, right, as the entire community, you end up thinking tech tech, tech product, product product. But in reality, the challenges faced by the real estate broker community is actually not the tech. Right. The challenge is in training, it's in understanding how to work in a sophisticated manner. It's in having processes that can work it is to understand, you know, how do you build a business, putting the customer in the middle, and you know, building an ecosystem around the customer. I think today, tech can help quite a bit, especially on the training front, potentially, to an extent on the certification front as well. But those were not options that we had in 2013. Nobody had a laptop, right, and the broker ecosystems, the lump enmasse, no one had a laptop, 3g was a thing. But people kept their data off all the time as an It was a very different world at that time. So I think even today, I think companies like square yards and prop tiger and a few other, you know, organized broking efforts, they're doing very well, these are all 100 growth plus revenue companies operating profitably, you'll never hear about them because they don't reach the critical scale that a property portal can actually reach. But these are all companies who employ 1000s of real estate agents on their payroll, to ferry customers from property to property and, you know, do the whole nine yards, I wouldn't say they are where they should be in comparison to Western words. But if you go and let's say potentially buy a house using a square yards, versus let's say, the neighborhood broker, you will surely notice the difference. And I think some things take a long time to do. So you can't really Hurry up, you know, 20 years of industry evolution into two years just because, you know, you want to go and sell a product to that industry. So I think these are all natural, you know, adoption in evolution curves. I still feel like brokers have a very good role to play in the real estate ecosystem, if they're willing to adapt and adopt.

Krishna Jonnakadla  29:31

I you know, the funny thing is, you mentioned about the brokerage component in India being at 1%. That's sort of like the standard right yeah. And and that is, that is not even 1% from each the buyer and the seller exactly the aggregate. So in effect the buyer is paying, if, depending on if the buyer and seller have agreed to share that becomes half a percent from half a percent of the end from the seller, but in most cases, it's the seller that's paying that 1% In in the Indian context for a property sale, but when it comes to rentals in, in most cases, it's possibly a dual thing the landlord is paying some portion of it the and depending upon the area, depending upon the demand depending upon a variety of those things and there is no standard anywhere other than for sale, it sort of generally assume that 1% is a is a good thing. And you may be right about the tech part because just a couple of weeks ago, for instance, the I think the Karnataka government and, and, more specifically, I think the Bangalore Corporation, announced the Carter portrait. The funny thing is, recently, I got my hypothecation removed for my cars. Okay, once the hypothecation is removed, you get an extract that comes from a portal called vahagn, which is a central government portal. The interface is really horrendous. But anyway, we'll take compared to the ramshackle road RTO offices will still take that ramshackle portal any day, right? The same thing using vahagn. The same extract and root extract cost me 10 rupees. So the broker collects 9300 rupees from me. Yeah. So, so when you think of situations like that he's not adding any value. Yeah. And that's actually ransom. He's you know, charging 300 rupees for a 10 rupee extract is is like a ransom. Yeah. But when you look at so which is why the khata portrait, which the Municipal Corporation has launched, the Bangalore corporation can be a game changer. Now, there are lots of gaming that these people do in terms of putting in bad data. And there are these database guys at the backend to a certain extent, who don't do a good job of writing these queries. Well, structuring these well, but it is, I think, on a 10 point scale, about maybe six to five or six points they're getting there. So I think in 2013, tech was really not there. We had the boomy Land Records digitization program for Karnataka, which was still underway. And and you know, recently, it occurred to me, finally, a lot of people don't understand it. This has been there for quite some time. The sub registrar offices, which really registered all property transactions, right, right, have gone digital quite a while ago, right? property numbers, property records, they've been computing, they have been localized. They were zones, right. So they were localized. But all of them did that business through a computer. The question was, was it an internal facing network? Or was it an external facing network? That was one aspect. So to a certain extent, digitization does exist, but but I still think from a broker perspective, the training part, even though sophisticated brokers, even square yards, while the experience might be better, right, right. I don't really think they're offering an exponential amount of value. And I'll and I'll elaborate that in a second. So in in the year 2011. In fact, in the year 2010, we were house hunting in the US. We had lived in apartments for close to eight years. And I came very close to buying a home before the 2008 financial crisis. And one of my good friends, he made some comment. I was just three years into the country. And the funny thing was, I was very clear, you know, I still wanted to take my time. I was in living in Chicago, my wife and I, we were living in Chicago at that time. And we were considering purchasing a home and this friend of mine said, Do you think it's too early to buy a home? You guys have been here just three years. And I look back I said, Yeah, I'm thank you for telling me that I'm early, I was thinking the same thing. But compared to that, peers and friends of ours, who are just who had just been there for a year, and both of them were techies, they were working there, like we have two incomes, let's go buy a home. They all bought a home and buy by 2008 2009 when the financial crisis and the housing bubble burst, almost every one of them lost their downpayment equivalent. If the value of the home was half a million dollars, yeah, they would have been they would have put in about 20 30%. So either 100 and $100,000 or 120 or $30,000. Yeah, when 2008 2009 hit, that entire component was wiped out, right? Fortunately for us that just one single remark from my friend actually stopped us from making an investment. And 2010 we started looking for a home we took about 14 months. And in that time, so realist realtors, they're the kinds of things that they will tell you is so for instance, I saw a golf a homeowner golf course. It was on the 17th hole and some fabulous one But the funny thing is, I asked, you know, the realtor, why is the existing owner selling this, and she gave me some story about somebody moving away. And she promised to find out what the real reason was. And then it so happened that it was on an average, every single day, it was not surprising to see a golf ball or to end up in the kitchen. And so they found it little really irritating. You know, that would happen on a regular basis. And they said they are going to sell as charming as buying that one look like. And there was another other one. And the home looked great. It was actually owned by a real estate agent herself. And I asked our agent, should we buy this? And she looked at everything. She said, this whole homes. Fantastic. But there's a problem that you haven't noticed. And they were high tension power lines, right behind the home. It's actually never been proven. But there have been some cases where high tension power lines have caused magnetic fields around homes. Yeah. Which could be a health hazard. Right? So the broker would tell you these sorts of things. Yeah, hand up. We found these. And we've lived around that place for for a while. It's not like we just moved to that locality, right. Yep. And there is incredible value. Yep. Tidy up the home, they will tell us Hey, you know, the front front porch should look like this. Let's go to Home Depot and bring all these flowers. This let's get a let's get a flowerbed, let's do all the things you possibly don't need to upgrade your bathroom. But maybe you should upgrade your kitchen. When you bought the home, it was all white. Now, the contemporary trend is to make it a little Woody and little steel. So they would offer all of these things. And they would collect a hefty hefty commission. It's 12%. Right? So and that 12% 6% comes from the buyer 6% comes from the seller. I think it's in the US it's six in total split three, three and three to seller and buyer it you're right sorry, my back. So six, so 3%. So half comes from the buyer half comes from the seller. And contractually, it's set up in such a way that if the seller refuses to pay, the buyer is obligated to pony up the entire amount. So on a 300 $400,000 property, it is over and above that right it is not inclusive of that so you can end up spending another 20 $30,000 in cool, you know real estate commission itself, though, but they're the listing portals, for instance, do not have data pollution, right? So the photographs you while while the 360 degree tour and all of that was great. Even today, many us portals don't offer 360 degree tools, right but the photographs are nice. They will tell you a lay give me give you a lay of the land, they'll tell you what the home looks like. And in most cases, the photographs look better than the home. And amidst all of this, so you have Keller Williams, and they have Coldwell Banker, you have REMAX and you have all of these large portals ebby Halliday there. They have like this query arts of the world. They have agents on their payroll are affiliated to them. Yeah. But underlying all of this is a little known company. We you might be familiar with it called real page. Right? Real page has a monopoly. Yeah. Real page is the company that is controlling the listings. Yeah, every single one of them has to pay real page money to actually license the listing. Right. So all of these tools that the real estate agent needs, okay, location, the clothes by schools, all the all of this. So that exists. And Funny thing is Zillow actually took the real page market Listing Service and created a great little. So So Zillow took county tax information, right, nearby estimates, and it took all the information that realpage offered. And he did an amazing tool, right. So a lot of people when they look at these things, they do not understand the real page. They do not understand county tax, county tax reports. You have to do all of those things. So I'm okay showing location, but in my opinion today, and I think we have to a certain degree, maybe for certain parts of Bangalore that are within the Bangalore Corporation limits are available. Yeah. Now there's just one stumbling block in all of this. There's a lot of black money hidden in real estate, right? So the more data is visible, the more intelligence will will be visible. So the vested interests have a vested interest not to actually provide access to that. So and then, let's let's let's continue with the evolution.

Ajay Kumar  39:57

Sure. So we had a reasonably big tech enabled property management business, right. And that was called cozyhomz. Yeah, it was going reasonably well. Not much to complain, the business was actually profitable, it was growing about like 10 to 10%, on a bad month and about 20% on a good month. And it was going fine as in, we didn't really have any problem with it, but it was not scaling as quickly as what our aspirations wanted it to. And primarily because there was an offline component, it's an operations business, you have to take people and sell houses and sign agreements offline, and you don't go meet owners in person. And it's not a tech, you know, high, high speed high escape business. Absolutely nothing wrong with that, just that that's not what Bala and I, you know, wanted to do, we wanted to build a business that can scale very quickly. And that was one reason. Second reason was that, when we had started the business, given our, you know, tech backgrounds and our inclination, on the product side, we actually built a product ourselves to manage our leads, manager, portfolios, manager, accounting, so on and so forth. And by 2018, we actually had a pretty good software that we had built, that, you know, we were using to manage, you know, 1000 plus customer interactions. And we slowly started speaking to other companies saying, Hey, we want the software, you know, we've kind of started building this. And that was a very interesting thing, because quite a few said, Yes, initially, we started with a couple of paying guest operators, they were interested in using our system in order to manage their bookings, and collect rent, we have a couple of facility management companies who were in are willing to use the software, we had a couple of direct competitors, you know, like, willing to try it out as well. So by early 2019, we actually had enough traction on the software side, that we felt, hey, maybe this is the business that we've been looking for all along hidden in plain sight, you know, within our core operations engine. And that's when you know, we took a call, you know, let's get rid of the cozyhomz business as such, let's, you know, hand it over to someone else who might be more inclined towards running that business. And let's focus on scaling up purely as a tech platform. And that's kind of what we did, we spoke to quite a few people in the market, we spoke to a lot of our competition to see if they were interested to take over that business. And eventually, we sold it to one of the largest broking firms in Bangalore, whom I had known actually for quite some time. And we just, you know, finish that transition as well. So they took over our entire portfolio, they already had a, they were mainly they were mainly a broken entity looking to get into property management. So this kind of fit strategically nicely into the picture. And we were able to, you know, give our baby a new home and, you know, focus on the next baby, which is essentially what the house monk is today.

Krishna Jonnakadla  42:37

I think the house monk in its current avatar sounds very promising, because I've seen the broken interactions.

Ajay Kumar  42:44


Krishna Jonnakadla  42:45

They're even very, very established vendors. Let's take shoba or is in the bangle context, brigade. And they're all run by very old people who come from a maybe for three or four generations prior, notwithstanding the fact that they all have kids who are, you know, quite young, and but they haven't, this is a much needed aspect, right? It is almost like the QuickBooks of real estate management.

Ajay Kumar  43:13

So there are so many aspects about real estate, which makes it a complicated business. But let me maybe set the context right on why why don't real estate businesses use technology the same way other verticals use technology. And, you know, for context, real estate as an industry spends about 2.15% of industry revenues on software and technology. Now, in comparison, automobile industry spends about two and a half times that it's about point 4% of industry revenues. pharma spends about point 6% logistics is at point four 5.5%, retail e commerce and you know, they're actually looking a lot more tech savvy than anyone else. So real estate amongst all major verticals, actually spends least on software. And we have to start thinking of reasons why. Right? It cannot just be an anomaly that, you know, like every major industry spends three to four times, right, and I'm not talking only about India, I'm talking at a global level, you can pull apart, you know, any portion of the world and you know, the statistic empirically, at least, you know, like it stands the same real estate businesses just spend a lot less on software. And one big reason is that real estate is super unique that the product cannot go to the customer. customer has to go to the product, right? Because it's a mobile and nature fundamentally makes it an offline industry. Makes a lot of things tough to automate, makes a lot of things very difficult to digitize. That's reason one, right? Why real estate is very averse to technology. Second thing that we notice is that the transaction sizes are huge. But even if you are going to be renting a property for let's say two years, let's say you're paying 30,000 a month, that's about 7.2 lakhs over the course of two years, right? Even for a renter, that is the single highest wallet share of anything I want to be spending on right over the next two is very likely that is going to be one of the one of the highest if you're buying a house. Definitely This is your biggest expenditure in your lifetime, right? Given that transaction size is so high, customers are not as inclined towards a tech solution because they want to know who they're doing business with, right, they want to meet the landlord meet the seller meet the builder, more than 20 times, you know, before they make a decision. That is Reason number two. Reason number three, why tech adoption is low is that the transaction cycle is very long. Even let's say if you're renting a property from the time you start your house hunting till the day you get inside, it's easy, 30 to 40 days. And by the time you exit, it's potentially One Two years later, right? rental transactions also take a very long time to to finish off the full transaction sale transactions, let's say even if you're buying from a builder, it's gonna take you let's say you start searching now, potentially six months to 12 months later, you make the booking, if you're buying an under construction project two to three years, you know, before they hand it over to you one more year, and the builder is still maintaining the project in no way or owner Association events new takes over. This is also a three to five year life cycle. So the life cycle of customers interactions between between the customer and the business is also very long, right? So these are the three big reasons why tech adoption has always been very, very long life cycle high transaction value, fundamentally an offline industry, which is why you don't see real estate businesses running to the new software solution. Right now, I think there are two or three things, I think COVID is definitely accelerating this adoption, because customers don't want as much offline interaction as they were looking for before. So that's a Seesmic shift. That has been this was something that I think was happening slowly, slowly, slowly, slowly, over the last, you know, like 510 years. But I think like, you know, five years of adoption has basically happened over the last five months. So I think that's a big change, which is happening in the industry. A second interesting trend that I can notice is that the demographic of the homebuyer is also changing now. So you know, earlier like in the 1980s, and you know, like much earlier on before home loans were a thing. People used to work all their life save up as much money as they can. And at the cusp of retirement, they used to buy their house so that they can retire in peace and not wavering, right? I think so much of wealth, creation, globalization, all these things happen. And I think, between 2000 to 2010, I think the average age of the homebuyer became much, much less than maybe it was like 25-30. Like, typically, you know, you get married, buy a house, or like get a car and people bought into that mindset. Now, I think over the last five years, it's getting pushed back once again. So by the looks of it, I think the age of an average homebuyer today is closer to 35. It used to be 28, you know, maybe 20 years ago, 2010. By the looks of it, it's about 35 now, and it's pushing even backwards. Now, that means quite a lot of things. Of course, it's a reaction to the extremely high prices of real estate in cities. That's that's one point to keep in mind. Second, is the flexibility that younger people want today, that I don't want to get tied down to a house, I don't want to get stuck paying EMI, I want a lot more freedom and flexibility. So in general, there has been a very strong push towards rental housing as an industry. And there's been a lot of focus on the rental industry as such. So these are some things that are happening, we have to see how COVID is going to impact the rental housing industry at large. Is it going to signal to people a I don't want to rent, you know, I want to buy a house so that I can in case you know, there is something like this, that happens again, I don't have the safety and comfort of my own home? Or is it actually going to go the other way around? Because rental prices have actually dropped quite a bit, is it going to push more people to continue renting houses? I think that's another you know, trend for us to look out for. But this is the macro landscape, right of like where real estate and rental industries stand. And to put simply, I think the Houseman was building the operating system for this entire this entire ecosystem. We are very inspired by being a vertical SaaS company, we feel that there is there are enough and more examples of vertical SaaS companies doing great things in other domains, right. Viva is an inspiration for us, they have done great things for the pharmaceutical industry. Procore has done the same for construction industry in Ford has done for manufacturing. And I think even more recent examples. You know, there is, I think innovator, you know who's doing something interesting, quite a few companies in the logistics space. There's a lot of vertical SaaS movement that is happening. Once again, no one is doing something like this in the real estate industry. So either we are far ahead of the pack in building something like this for industry for this particular industry, or we're like you know, we're not seeing something that everyone else is seeing, right. So it's it's one of the two, but we really feel that this industry needs a complete rethink from a software standpoint. And we're doing that essentially we're building a very end to end solution which is something that companies look for in emerging parts of the world. We are building a transaction engineer not just a pure software but once you work with the house monk, you can do transactions, you know using our system as well. We enable payment collections and you know keeping your books of accounts clean of we've made user experience. So we've started with user experience, we know that a lot of bad products exist in the industry, and we essentially want to make sure that doesn't happen. So we're packing all of these different layers, right, like a transaction engine, great SaaS software, you know, packet up a great design, use all of this and go after, you know, like a trillion dollars market. And hopefully, you can grab a good piece of the pie. So, you know, this is just, this is a very high level hypothesis, and we know how we are doing things at the House Monk.

Krishna Jonnakadla  50:25

No, I think you are ahead of your time, in my opinion. See, going back to the earlier Let's enable the brokers kind of standpoint, let's, let's take a different analogy, a parallel what Tesla is doing Right, right. So in the US, every car is through sold through a dealership, right? Now, what happens with dealership in the US and it is a similar parallel in India can be found through fmcg companies, the relationship with the customer between the brand and the customer is built by the company, the actual transaction is actually facilitated by the dealer. So for instance, on an average day, you can see that all and then Britannia, and you can do all of this, but when you go either to your neighborhood grocery store, all your medical store, the things that that fellow displays, and then the things that that fellow is going to recommend barring a few that have a significant amount of mindshare is going to be dictated by that last mile, right. But what Tesla is doing is most of the dealers and and the way these fmcg companies back in my you know, in the late 2000s, when I was managing a supply chain practice, we would always talk about channel stuffing. So essentially, what would happen is, if General Motors for instance, wanted to show maybe 2% more, all they would do is work with the dealers to take on more inventory. No, after a point of time point in time that backfires. And, but essentially, it's like a you know, it's a large change they're pushing, and for a profit that is that has created an ecosystem of its own. Tesla is a car that is very different from any of the other products out there. And he he Elon Musk has sort of intuitively understood that a the dealership doesn't work for his product, and B, it has got a perverse set of incentives that will actually destroy if the product was actually introduced that way. So he's virtually taken on the every there are lots of automobile dealerships in the US that are literally like many fortune 500 companies that that have very wealthy owners, and therefore they are very powerful campaign contributors. So Elon Musk is already taking on a very politically significant constituency right. Now in that in a parallel to that is what you're suggesting. So the taking on but I think what you're so I still feel there is still enough juice out there. I don't think enabling the see somewhere, an entity and a set of people really need to show up that are that. So part of this whole skill India, the one aspect that a lot of people don't get is world over. Number one wealth creator has always been infrastructure and housing. Correct? Right rooted in roti, kapra and makhan. roti and Cobra are really smaller industries, but by their sheer value housing much, much larger. They've changed the face of you know, entire nations, much of the wealth created between 1992 and mid mid 2000 times for 1420s in the US is all housing. And and when the Americans didn't stop buying it was the Chinese that were buying. At one point in time it was the Japanese that were buying right and then eventually needs now the Chinese are buying Right, right. It is it is a testimony to the the efficiency of the way you can by remotely sitting here. Right. Right. So there is much miles to go as far as India is concerned. I think from that perspective, you guys are already on the right track. And I'm quite certain that brokers the broker, fraternity if they don't evolve, yeah, they will disintermediated at some point in time. So the magic bricks while they may look wise today, right? So there'll be a set of people that will come in and then say, okay, you know, these vestiges don't work anymore. Correct. All the information that these two combination guys are actually creating it. Yeah, I am going to have my own fleet of agents, which possibly square yards are already doing. Yeah. And then I'm going to do so much due diligence ahead, right, that I can offer 100 x value compared to what these guys are going to offer. Correct. Right. Now you are dealing with the other set of things, which is there are all these suppliers. They haven't found a way to really build good relationships because each one of us most of the buyers are working in banking, financial tech industries. They're using it for long of their things, they're making payments in UPI. And all of a sudden, they're coming to rent their apartment. And then they are seeing, and it is still feels old school. Right, which is the gap you're filling. And it's sort of like a no brainer. But so I know you're on a great route, but I want to cover the scale angle. Sure. 100,000 properties is not a mean accomplishment. And then I, you know, the client list is very, very, you know, well known names in the industry, then all of it looks like you've done it in two years, ever since you sort of pivoted to the SaaS play.

Ajay Kumar  55:35

I think we had an unfair advantage, which is that we had a built product that really worked on day zero, okay. So even though it's actually only two years in the making, I mean, two years for the house, the core product we're selling, we started developing that in 2016, itself when we were doing cozyhomz, right. So it took two years to build that product, and test it with an in house team for actually the users. So by the time we got to make 2018, we had a very functional product that had been validated by an external customers as well. So that that's what gave us the confidence that we knew the product work, because we were using it ourselves. And there were companies outside also who were using the product and who are giving us very good feedback, right? I mean, they were not someone not willing to take it completely as it is. But they were convinced that 80% of their use case was being covered using our system, which gave us a lot more confidence. So I think a big reason why we've been able to get the kind of traction rate that we've managed to get, it's because we had a head start. So I think the entire journey of finding product market fit, right, like the the there's a lot being said about, you know, Product Market Fit recently. But I think a very important aspect to keep in mind is that it takes time, more than anything else. And but we got to do your head start.

Krishna Jonnakadla  56:53

So you were your own. You were eating your own dog food. You know, that's kind of one second. I'll be back in one second. Yeah. So so you I was just saying you were eating your own dog food. Indian? Yeah. It's an age old phrase that says, you know, if it's good for your dog, it's good for you so to speak. But but but that to the two years, it was a live product. Yeah. used on live properties. Yeah. That had been seasoned. Yeah. And with your design focus, right. And, and in some sense, it is like, a product market fit literally, four or five years in the making, right? years in the making, perhaps because 2013 is when you started? Yeah. That three years you spent and spent understanding the industry? Yes, you say, okay, we want to change a little bit and start doing our own stuff. Yeah, you manage your properties. And then you decide, gee, this is all broken. And, you know, for two engineers who's doing it, obviously, that's exactly what you would do. You would automate stuff. Yeah. I'm not going to run it with spreadsheets, and then papers and then calculators, because there's no way I'll be able to scale or manage the manage this meaningfully, right. And five years, you've taken all of your learnings and then you and bang, now you're showing it to a brigade, you're showing it to a bunch of other people, and then they're like, Where were you guys?

Ajay Kumar  58:19

Yeah. It is it is. I think the journey to finding product market fit is brutal. I think it takes there's a lot of different things, in the sense that you need to understand the market really well. Right, you need to have the ability to tweet your product very quickly. And you need to be open to the feedback market has given you Right, so I can I can talk maybe a little about the product market fit journey itself, right? Like do please do when the initial version. So first, we built it as an internal product. And as you can imagine, when it's an internal product, it's a whole bunch of mandates, right, like as in to make sure the product just works. Because you're not thinking of giving it to anybody outside. At the time, we didn't really hire a designer, because we were like your your user is that way, you know sitting two seats away, if he has an Odeon come and ask the engineer, right, like so you don't need to get a great designer, you know, to design the product. So the internal product was quite shabby. I would say, you know, three engineers just built it without a UI designer or anything. But when we decided that, okay, no, we're gonna give it to people outside. It took us about six months to re engineer re architect refactor and they don't agree to the entire UI, so that we can even go and show to other people. Right? So that process you know, took quite a bit of time. And when we started showing it to other people now once again, for someone on the outside, it might look like okay, it's it's a SaaS product for the real estate industry. But real estate also has about 10 different types of businesses within the real estate industry. There are real estate developers real estate brokers, property managers, polling companies, for working companies, like so many other people facility management company. So initially like we did not understand this very clearly. So we took it to pretty much everyone, right? We had a few real estate builders who are using it, they were very happy. We had a couple of owner associations we sold to they were also like, you know, giving a lukewarm response felt like we could do something, if we wanted to really go deeper. We had a couple of facility management companies were paying good money, right on either facility management companies or large real estate developers using it to manage their facilities for that particular use case. And we had the rental use cases. But so we had about four or five use cases that the platform was deployed for. And that put us in a slightly tricky position. Because, one, when you're selling a product, when anybody is saying, boss, I'll pay you for your product. You don't want to let that person go, right? Because you're chasing customers all the time. Somebody says, Okay, I'll take it. You're so elated that you want to say yes. And that's what we did. We said yes to so many people. But at one point, we realized that, oh, there are so many different types of users. second mistake, I would say is that we deployed it not really a mistake, but we deployed it to so many companies in different countries, right? Like we had Southeast Asia, Middle East, India, like all over Asia, once again, there is a geographical specificity as well, right? So at one point, we realized there is no homogeneity, right? Like what an owner Association wants is not what a real estate developer wants is not what a rental manager wants. So it took us some time to realize that, you know, either build for one geography, and you know, like, take that course, or at least there'll be some homogeneity there, or build for one user type, which will also, you know, bring you some homogeneity. Ideally, if you can identify a deep enough market, build for one user type in one geography. Right. So, I mean, this is not really unconventional advice. But it took us some time to understand this. Right, like, because we were so business minded that anyone says yes, you know, let's see if we can, you know, give something to them. But that took us quite a bit of time to realize that, no, we need to start saying no, to certain people. And it kind of like no, like, led us to one of these philosophies that I have right now, which, you know, I'm sharing with anyone who will care to this lesson, which is that at an early stage, when you're still finding product market fit, I think you should not have more than three engineers in your team. Three good engineers, and one product designer should be your initial team till you find product market fit. The only reason I say that is maybe it's four, maybe it's five, but it's not 20. Engineers, right. And I see quite a lot of Indian companies, you know, who just keep scaling number of engineers that quickly, you know, what happens is that when you have a lot of engineering bandwidth, you start building features that might not be present. Right? anybody asks you for anything, you know, you say yes. Most importantly, you don't prioritize. And that is 101. From a product management perspective, and identifying product market fit, you need to be able to say no, that will force you to think, Oh, my God, I have 20 requests, what is that request, which is going to add most value to the ecosystem I'm trying to serve? Right, we'll meet you make very hard decisions. And I think that's very important. So at certain points, even we felt that we went a little off track, we were building so many things for so many people, we ended up having a bloated product, new users were getting intimidated, because we had, you know, almost 20 different features that they just wanted to and we were giving them 20. Right. So there was a very interesting journey. But finally, like, I mean, it took us a while to get that right. I'm still trading. It's not like we have the solution yet. But at least I feel that now we have a good framework, right? Like whenever we're entering a new geography or a new customer type, we have a good framework on how we should go about that. And I think that's very mean.

Krishna Jonnakadla  1:03:33

We are going we are going through the journey right now. In fact. So we, after the previous, I was with a company in the blockchain space, the cryptocurrency space, okay, and then recently launched a product called vouch, which is a digital escrow product, essentially, that helps. Real estate is a classic example of where escrow works, right. But we wanted to take all the complexity that comes in, in an escrow. And all, I've always looked at products in one way, which is digitizing a product doesn't necessarily mean mimicking all the offline interactions that happen online. Right? Yeah, you have to look at many of those offline interactions and say, is this really essential? Yeah. So that's the approach we've taken in that we have identified quite a few use cases. We are in a similar situation like you're in. We've chosen a target audience, right? The and we know the target user. And in fact, we went through those problems ourselves, right? We realized that that's a problem that we had liked to solve. For the world of me for all the evolution that had happened in FinTech. I realized nobody was solving that problem I had, we had freelance contracts at over 80% of them. Payments are delayed, you need 1015 follow ups for every single payment. More than 40 50% of the payments don't even get made or the vendor payment. payment is made, there is severe negotiation that happens. So there's so much either revenue delay or revenue loss. Yeah. And then so much unpredictability. And I realized, when I looked around similar things happen, take a real estate transaction as well. Right? The broker actually being there is literally for that trust creation. Yeah. Because he knows. And then he's like, Okay, I'm gonna keep both of you honest, so to speak. Yeah. So he's the he's biggest value of that 1% is a trust that seems to be between the two parties, correct? Correct. For us, we look at all these constituencies. We look at online sellers, online, online and social media sellers. You know, Whatsapp, Facebook, nobody has a trust building mechanism. Right. So when we see we see it as universal, as universal, but we are, you know, I'm of the opinion that a startup and actually not maybe not even an opinion, it's possibly prescient wisdom. It is good to have a universal problem to solve. Yeah, but do you have to begin for a specific particular type of user? Right? Whether it is deep enough or not, is actually really not so important right now? Yeah. Because if there is a trust building issue here, there is a payment issue here. These people have these people have it. Yeah, here, it is not a vertical play, it is still a horizontal play. What do you initially focus on it vertically? And then when that? because there'll be a lot of repeatability with a few changes here. And then that will happen with others, which is what you are. And I love the three engineer plus one product manager example that you gave, in some sense, you gave out a very specific to say his recommendation, No, do not have more than three plus one. Yeah, you didn't allow that you made it so specific. Because take your own example. Right, where you were doing cozyhomz. And then you wanted to scale? Yeah. in itself is not a bad idea. Right? Not a bad expectation or a wrong expectation of wanting to scale. Right? Because it's anybody would want to grow. I mean, that notion, but growing at a certain pace, where you're able to take advantage of the opportunities, and building it enduringly is the notion you don't hear everybody say, yeah, the whole of Valley is full of wisdom blitzscaling this blitzscaling that you don't go in six months, find your customer in three days, that sort of stuff. Right? I think the unsaid aspect of it is, hey, you should strive for it. Yeah, do not try to sort of cut short it by some artificial means. So that for the moment, it looks like you've achieved it. But when you actually see the evolution, you some somewhere ended up falling flat, right? We don't want to be a flash in the pan. You know, the flash is magical when it is flashing, but it beats it anything but that.

Ajay Kumar  1:07:52

I think that's something that I've noticed quite a lot in b2c, right. In b2c, what you do is that products are typically very simple, which is fine, which is what it should be if you're in a if you're a consumer app. But you constantly see these marketplaces and aggregator businesses, who come in by 400 rupees and sell for 90 rupees, of course, you're going to have hockey stick growth, and like, product market fit like, no, that's not product market. It makes absolutely no sense. Um, the very interesting thing about b2b SaaS is that you can't buy product market fit, you know, you can give me $10 million tomorrow, and it will not make me get to product market fit that much sooner than if I had 1 million in the bank, right? Like, you have to go through those iterations, you have to keep modifying, okay? Try this country inside and outside that country and try this user and find that user, let me change this UI, let me change the onboarding flow, let me try this payment flow, you have to do everything. And that is not something that you can do with a lot of money. And that's the reason why I stick to this three plus one framework. Because in the middle of all of this, if you have 10 engineers to manage, and very likely half of them are not trained, they don't understand the core product. Now that's one more problem, right? I need to train them, I need to hire them, I need to onboard them I need to do I need to like verify their codes, like all those things, you will actually delay finding product market fit. If you end up having a larger team so much easier, you know, just to have a small team, everyone's aligned, you know, like figure out, take the money do put that somewhere else, you know, spend it on marketing, spend it on building a community there is there is enough and more things you can spend on but there is that very common thing, right? Like the next feature will bring you your customers in a very magical fashion. Like we all need to realize that's not what that's not what's going to happen. Stick towards towards your core. And it is a principle of at any point in time, we keep asking ourselves, what is the lowest hanging fruit, right? As a startup, you're so devoid of resources like so to speak, that you really just want to know like, what is the smallest thing I can do which can get me the maximum impact, right? And if you have a larger team, you end up doing too many things to see what can work without pushing yourself to think about Okay, Let me try doing this small tweak, which will bring in an additional source of revenue. Or it may try maybe doing this language translation, which will open up that market, or it may try doing this other small thing which can make it, I don't know, freemium model, whatever that might be. I think that's very important to keep in mind.

Krishna Jonnakadla  1:10:15

I think that iterative, incremental thing, just like how you build a normal home, you don't build it in three months, even, even when we have a technology today where they talk about precast blocks, and then you can assemble a home. But that is still a house. But if for you to make it a home, it still takes three months, you know, getting all the interiors done. Right. Let's get back onto that. The so one is you had you had a working product. And that 100,000 properties, I'm quite certain It was not easy. Yeah. Well, I think it has happened in quicker fashion. Yeah. And, and many times, it's also an indicator, if something is sort of fitting in nicely, it is an indicator of the fact that there was already significant pent up demand in the market for enabling that. And you you happen to have built that right? Did you see any of that happen? where some of your first conversions.

Ajay Kumar  1:11:11

First conversions were almost exclusively through network, we didn't even try doing ads, or we didn't try doing any marketing. Thankfully, we've been in this space for a while, right. So we get in, at one point, a lot of them were competitors. But you know, we still knew them, you know, on a very friendly basis. So it was not that difficult to strike up a conversation. And even otherwise, I think it's not very difficult for founders to, you know, hustle and get the first 10 customers. And that's kind of what we did, like, we pinged as many people as we put on LinkedIn, like we asked as many people as we knew, who can introduce us to somebody, we were part of industry forums, we attended, you know, offline meetups, like we did, we did the usual startup. You know, like early stage hacks, quite a lot of that work. A lot of it was like, very deep conversations with the founders. So we sell directly to the founders, because we're a very full stack system. It's not a, we're not a tiny product that solves one problem really well, we are more of a bundled solution, which solves six, seven problems, you know, like all put into one super app. So typically, our sale is directly to the founders or in terms of if it's a larger organization, it's at least the chief operating officer or VP of operations, or somebody at that level. So when we started going to all of them, you know, in person, the early sales was not an out of the box sale, we had to do customizations we have to commit to doing okay, I will do all these things for you, like you know, and deployed over the next two months, three months, which was actually not something that we were aware of. We taught at SaaS products, there is only one way to sell us as product, which is you have a nice website, you put like start free trial, people will click the button, they will onboard themselves magically, 30 days later, they will place the card on file and life is amazing. We thought that was the case clearly not. And in case there's someone listening who wants to get into SaaS, let me tell you, that's not how early days of SaaS companies work. early days of sass companies that almost exclusively founders speaking directly to customers are doing customizations, because bigger customers will definitely ask for some customization, they will ask for some modification. They want their data to be hosted somewhere else they might want to know like a certain day they want the skin color to change, they'll have 1000 different questions. So don't think of completely automating your ecosystem on day zero, be open to another process. And I think that's what helps you in the long run. One, you will build relationships. So like, you know, like this can compound over time. But more importantly, like founders directly will get access to market Intel. Right? What is actually important for you. Even for us, let me give an example. Right, like, we had already built about eight, nine different features of modules, so to speak, everything from managing your inventory, taking bookings, collecting rent, you know, customer support tickets, you know, communication, we built quite a lot. And a lot of customers had actually signed up. But we really realized that one of the biggest pain points that a lot of rental property managers had was that the tenants were not paying rent on time, right? Because the operators or the property managers, they had to pay to the owner by the fifth no matter what. And typically tenants were taking longer to pay. And you know, if they force tenants to pay, like in a wrong way, they'll write a bad review on social media. And this was happening all over the world. This was not this ninja specific phenomena. So even though we had quite a lot, we realized and understood that that is actually a core pain point for everyone. They were like if your system can anyway help me get my collections in on time, so that I can I don't have a cashflow shortage, that will be super useful. And then we started going deeper into that feature that we were we started implementing Okay, like invoicing happens on the first of the month, automatically, your team doesn't need to get involved, it'll automatically send it as an email SMS, it'll go through the app in case you have one. If people don't pay beyond the third, automatically three reminders go every day beyond the first five reminders goes every day, beyond the seventh automatically a fine starts getting imposed. So you know, your team can simply tell customers that I didn't put the Find the system puts it by itself, I don't have an option to reverse it. So no, they also have an out an alibi. And we realized that this was actually solving a very big problem, even though we had another 10 features. This is actually what got customers in the door, right? Like retention was through something else. But acquisition was through something else, right. And this interview would have never understood because people kept if I was looking at product usage, they were using the rental product, right, they were using the collection product. But in reality, when we spoke to them, only then we understood the true pain was not that the collection was a problem, but I'm not able to send it out to the relevant landlords on time. And that's creating cash flow issues, I have to take short term debt from somewhere, I have to service that debt, isn't it, it goes into crazy cycles. So it's super important to know like how conversations as much as possible, build network build relationships, that will end up compounding over time. And most importantly, like, it's unique testimonials, if you are in the SaaS industry, like if you have any b2b industry, actually any any business so to speak. But if we have deeper relationships, or you know, like personal relationships, it really helps in getting these testimonials and references. Well, so that's yet another reason to do that. Awesome. What is the one before I asked the next question, what is the one that actually retain the customers? That's a good question. One of the things we do is we enable these brands to build their own website and build their own app. Right. So it's, it ends up as kind of like a white label, but it's their brand that goes in front of their customers, before we came into the market, it was typically a very expensive way to build your so let's say you want to build your app, right? Like you will go contract some local IT services company, app development company, whoever, some 1015 lakhs and you know, like maintenance, you pay something separately, and it just doesn't work, right? It's, it's not really a very, it's not a great way to do this, we got into the market. And we completely inverted that. And we said, this entire thing you're going to get for a subscription, don't pay me anything upfront, use our tool, build your own website, build your own app, we'll take care of maintenance, we'll take care of upgrades and all of this you get for like an extra 250 dollars a month, that was a true game changer for us. And that is actually what retains customers or even during COVID. Right? Like there has been quite a lot of challenges faced by all these businesses. I think a very important reason why our customers are still sticking to us is that for them, the brand appeal is very important. Right? So for two things, one, it's actually important to have because you should signal to your customers that you're taking technology very seriously. And it's at the heart of what you do. And to even in reality, it is that way, right. So if a customer wants to pay rent, they go to a client's website, or they open up our clients app, and they pay the rent from them, right? So we help them establish a digital presence, which is super important. And that is what keeps them even if they don't use most of our ecosystem, the fact that their online presence is powered through us in some capacity. That's what keeps them keeps up with us.

Krishna Jonnakadla  1:17:49

Surprisingly enough, in India, real estate is not necessarily a low spend market, isn't it? When it comes to commercial grade properties. properties of all kinds have a fairly significant value even in when when we compare Western markets. Yeah. rentals may or may not be completely so. But at least commercial property rentals are, you know, fairly benchmark. And so it's it is not one of those industries, where spend is low. So for instance, if we take the film industry will say we make so many films, but average ticket prices only, like half $1. Or you know that but real estate is not one of those industries where there is such a low spend it is and and the thing is it's not a small nation either. It's got lots of markets. Yeah. Upwards of 100 cities right now, easily, you know, of decent size, and all of them and all of this still ramshackle, and, you know, still scratching the surface.

Ajay Kumar  1:18:51

 Both in India, as well as real estate is a very high transaction value. Very, very valuable market, right. Yeah, yeah. A real estate business can make, let's say, 5% margin, but the base of that 5% is so much that it is very meaningful. That's right. That's right. Oh, that's how we think about it. Like, it's it's a very similar story, like, you know, whether you're in the US, Europe, India, Southeast Asia, like no, like, Middle East. Yeah, transaction values are high. Tech adoption is very low, people want to have a very good brand presence. See, a challenge is that typically in real estate, like, everything quickly becomes a commodity business, right? Like, every house starts looking similar after a point like especially let's say you go into a gated society, right? There are some 500 apartments, all of which are essentially the same. Now, for you as a builder, or for you as a seller or for you as a property manager. How do you actually differentiate, right, you need to start thinking from that perspective, and I think a very good extent it starts by showing the customer that you're very serious about their requirements, and you start there and you work backwards from there.

Krishna Jonnakadla  1:19:54

So looking back, we've discussed it in some form or fashion. What are some inflection points If that has helped in your journey, sure. And some challenges, which I tend to ask this question, anything that sort of gave you the feeling that Oh, gosh, you know, this is going to break this COVID may have been that. But do you worry that this is all going to fall apart? So, so two questions their inflection points.

Ajay Kumar  1:20:21

And I think inflection point was, so we've had two major inflection points, right, first was pivoting from the brokerage to another property management business. And second was pivoting from property management to software. Right. So I think two very big pivots in my journey. I think even within the property management software business, you know, which we started about two years ago, about six months after starting, that's when we realized that this customer experience this white labeling this digital presence, we discovered that, so this was maybe mid 2019, some time, that was very pivotal for our business, because once we started telling clients, hey, you know, like, I can set up your digital identity and your customers can interact with, you know, like your own app, that was a game changer. Like we started seeing conversions, which were typically at that point was like, 5% of leads that came in like an O converted at some stage, immediately, it went up to almost 17 18%, it was such a big jump that we knew that, okay, this is basically what we need to know, work towards. With respect to challenges that we see, I don't really think of too many existential threats. Because we have enough traction, we speak to customers all the time. So we know that this is a very good business to be in, um, we are very confident that this can become a very big business as well, right? Like, I mean, I look at like multiple countries that it looks like, nowhere Is it very different from you know how it happens, you know, here in India, and we have clients in about 12 countries now. And it seems very similar, right, like all of these pockets, I think COVID has definitely posed a very big challenge, because what's really happening is that a lot of CO working companies, which are our clients, they're facing dwindling, occupancies not sure when that's going to come back to where it was before. So some of our clients are facing existential threats in the, in the in the commercial real estate sector, not too dissimilar in the rental real estate, residential rental sector as well. Because across the world, people have left urban cities gone back to their hometowns, shacking up with their parents moved completely remote, you know, like, into scenic parts of the world and simply working from there. So a lot of our hypotheses has been, we've kind of taken a big bet that cities will remain and cities will flourish, right, and we've, you know, kind of like built ecosystems around that, I would say like, that is a challenge, you know, to see whether the world continues in the same way, or maybe you know, this is going to be something different. That aside, like, we're not too too concerned as such.

Krishna Jonnakadla  1:22:42

I actually have a feeling, it's not really a theory that as soon as they are the ones that are shacking with their parents, as soon as they discover that there has been an absolute loss of privacy, and also personal space, so to speak. Right, will will, you know, scurry back across to wherever, you know, provided them the life. And and the ones for instance, you know, I used to work in Chennai for some time. And Tamil people are stubbornly loyal to their states. Yes. And they would talk about, oh, I will never leave Chennai. So, the people that have that degree of loyalty, I think, will create a new city altogether, or a new So in some sense, I think the, the net impact is only positive. That's that's how I see even the CO working space, think about it, the the things that I'm hearing about right now are people would go to 400-500 employee floors. Right now, with the emergence of the, you know, the remote worker, the remote worker occasionally does need a productive place, right. So So now what we have seen in the CO working space is actually still a scratch of the surface, the most of them are very, very small. They have about maybe 180, seats, 100 seats, 200 seats, yeah. But all these satellite workers, there is remote workers who have to get into a meeting room or possibly want to get into a distraction free environment with certain amenities, or maybe high speed internet even where productivity is going to be the focus. See, as soon as you are remote, the fundamental thing is, you can't manage anybody by input, you have to manage people by output. Now, as soon as output focus happens, then productivity focus has to come in on both sides. I mean, you have to set it up as an environment for productivity. And I and I think the CO working spaces have just seen a small Blip. And just like Airbnb was born in the recession of 2009 2010, where eventually, you know, that sharing economy boom, I think same thing, something similar, the model is likely to be similar and if anything, humans are adaptable, even the rental ones We are going to see is a change in the model? Yeah, because housing is a very innate need, right? It is not, it's not going to go away. And ownership is also, you know that earlier example, you talked about somebody who's 50, and he wants to retire in peace today, they might be that way. But millions of people, they need a model presented with a model that works with them, whoever comes up with that, you know, is going to, you know, take a huge chunk off of that.

Ajay Kumar  1:25:28

I'm very sold that cities will remain, right. Like I believe in the resilience of cities. You know, like, Los Angeles, New York, London, Bombay, Bangalore, and these are not fly by night, you know, phenomena, right, like, deep value in, in physical networks. As you know, you can do a lot of it through the internet, no denying that. But I think the way forward is potentially getting people back into the city. But maybe not getting everyone back into the office every day isn't I don't think we're ever going to go back to where we were pre COVID. But I don't think we're going to continue where we are today. Right? Even coming back into cities, I people, I see people buying homes, I see people renting homes, potentially, you might work from home, a lot more than you were doing before. But the way I think maybe once twice a week, I think people will definitely step into an office. And maybe the other days, they might just you know work from home.

Krishna Jonnakadla  1:26:22

Yeah, I cities. Definitely. I don't think they were never a thing in the 16th century Vijayanagara. There's a historian called Domingo pays. And he talks about that being such a big melting pot, and it's not like a 20th or 21st century 21st century feature in there. And you had, you know, from patliputra, to nalanda, takshashila. And all the way to, you know, Constantinople, which is modern day Istanbul cities have been at the crossroads of commerce for a long time. And I think the question is not whether cities The question is, are they going to be the same set? Or are they going to be a different set of cities, the mass case in Syria, at one point in time was at the cross of, you know, was a very important city, perhaps the most important city on the Silk Route, I hate is just, you know, torn apart by strife. So I saw today it's a different set of cities, but cities will exist, I'm sure. And with a peaceful region, I'm sure new ones will emerge in the Indian context. I don't I think we'll just see more cities. You know, that's, that's how it is, right? So...

Ajay Kumar  1:27:30

if you look at infrastructure in Indian cities itself was so broken, that it's not possible to imagine people living and working continuously from tier two towns, you know, like people came away from there for a reason. They wanted like, not just from a financial perspective or from a cultural perspective from a lifestyle choice they wanted a better lifestyle. That's why people came into cities in the first place. And I think those aspects have simply not changed.

Krishna Jonnakadla  1:27:54

 Huge difference. I keep telling people so for instance, on the way from Bangalore to tomb code there is a there is a town called Gorman early called to get a Corwin early they are on the they're on a slightly different path. So there is a famous temple in Corbin alley. The funny thing is the stark contrast in quality of things if it's x in Bangalore and that see that that small village or Hamlet or whatever little town is clinging on to Bangalore outskirts right? And the quality of things there of course peace and greenery all of that you know, let's leave that village aspect side it's one 20th right. So it is there is no way like you said people came to the cities for a reason. If anything, the other cities have to catch up in infrastructure they take Bangalore for example I'm I've long I've never seen I'm sort of a loner in only person that keeps thinking Bangalore is really well endowed with lots of good sized cities within our 4050 kilometer driving distance right around towards my soul or hosszu or North Bangalore or east Bangalore, you have good cities right? instead of building a good suburban rail system and the current suburban rail idea is a little bit of a sham You know, it is just taking existing rail tracks and then putting up doing some justice to it. But doing that would not only make Bangalore so much more of a greater Bangalore huge venue. So a case in point is Greater London. So if you go to London, you will see this phenomenon, the central London and around the the counties around it are rather small, right? What real London is, is this, all of these smaller cities, all of all around London that have become and every one of Western cities are an example the sports as they were called. So so that is yet to happen. I think the day that happens You know Mysore will become a city in its own right. The Bangalore Mysore, which is 90 kilometers and 144 miles. Now, when I used to live in Chicago, my wife used to my wife and I used to commute to downtown Chicago, which is which was 45 miles away, right. And door to door, it used to take us one hour. From the time we left our home to the time we actually entered our offices. It used to be 45 minutes on the 40 foot for seven, eight minutes to the train station. 45 minutes to the downtown train station, and then seven, eight minutes on a bad day when it used to snow heavily, maybe an hour and 20 minutes, right. Even light is not bad commute. Because the train journey is great. You just get on and get off. And you get to read you get to catch up on a lot of stuff. Yep. So that moment is yet to happen. I think when that moment really happens, a lot of things are likely to change. So Ajay fabulous conversation. Before we close. How did you and your co founder come together? Bala?

Ajay Kumar  1:30:59

 Oh, a lot of my friends in school, went to college with him. Oh, when we all ended up in Bangalore, I just met him at a party. And you know, like we were we were all getting together. So that's how I got to know him. I had known him even during our college times when we were both from Chennai, like when we were back in Chennai, like not just mutual friends, mutual friends, I have known him for quite a long time. He comes from an entrepreneurial background. His father has built multiple successful businesses. Nice thing he was working with devious Motor Company before. And he was itching to get started. So he he was not really for him. And real estate slash prop tech. It's not really a love marriage like it is for me. I think it's more of an arranged marriage for him where he was looking for an opportunity to dive into entrepreneurship. And I had known him and I invited him invited him to be part of the team. And that's essentially how he he came up with a picture.

Krishna Jonnakadla  1:31:50

Where you vote drunk at that party when you asked him to join you?

Ajay Kumar  1:31:53

Oh, yeah.

Krishna Jonnakadla  1:31:56

I was just wondering if it was one of those things where you were drunk and you're telling Bala, Bala you and I need to do this. Let's do that. And then Monday morning, Bala is reminding you, you told me we were going to do

Ajay Kumar  1:32:11

It was something similar, something.

Krishna Jonnakadla  1:32:14

Awesome. We've covered a wide variety of topics. In fact, this has been very different from a lot of other episodes we've had. And it's a richer conversation because real estate housing is you we can talk hours on end about this. Right?

Ajay Kumar  1:32:30

It's something very close to everyone because it's something everyone gets to experience. Yeah. So it's it's a topic which is very close to everyone's heart at some level.

Krishna Jonnakadla  1:32:38

Right. And and Indian real estate is full of opportunity. You know, the ones that digitize, you know, securitization of assets, right? Yeah. What do you has even thought about securitizing assets? So today there is a mortgage, a mortgage, the closest that has come to that is moving over your mortgage from one bank to another. Yeah, but rereads real estate investment trusts. trusts are only now showing up. But a good read market is driven by securitization of the underlying mortgages. Correct? Right. That has not happened yet. And you know, and that's a tech play, too. There is not really a but for that to happen, the government record system has to catch up. Yeah. And that will truly happen only the day property. Real Estate stops being the haven for black money that it is. It's If you ask me, I think it's the only remaining Bastion cryptocurrencies are starting to show promise that they can be that one, at least for the Indian ones that want to do the hide their black money, but it's still for people who are not that sophisticated in crypto and then yeah, and because a lot of sharks out there in the crypto world, real estate is still the be all and do all so hopefully that change. Yeah, and for people who are planning to start up start out you've already you know, given out much wisdom, any two things for the listeners and potential entrepreneurs out there.

Ajay Kumar  1:34:09

As you know, like I don't want to give like random advice that I think it's maybe the only thing that I would do differently if I were starting over is start with very deep market research. Don't start because you want to start because the market will kill you like that much I can tell you right like after multiple pivots, market won't accept your solution because you want the market to accept your solution. Market is brutal, like you know, you can pick the right product and the right team and market will still kill you. So understand that like most importantly, let people say oh, team founder first all those things. Doesn't matter. Right? Like market is everything. So speak to as many people as you can before you actually start neutral people don't ask your friends you know, if your startup idea is great, like they will always say yes, just to encourage you. Don't do that mistake. Don't speak to five people and then if you start getting initial validation Like, okay, like, you know, maybe this idea has promised don't do that. The the hard, brutal effort of speaking to not less than 100 people who are in the industry and ask them if they will actually pay if you build the solution, right, and you will actually bring it to life. And if you are very neutral about how you do that survey, and if you can't, if you conduct that in an intellectually honest way, you will know the answer, right? Like, you know, they say, you make the money when you, you book the profits when you make the purchase decision, not when you set, right, I think startups do a very great extent, your eventual success or failure gets decided when you start, right, you just have to wait five years or 10 years to you know, like to book the profit, or want to be a success or not, in most cases gets decided within your first six months, it should choose very wisely. Yeah, a lot of market research. If you identify the right market to enter at the right time, everything will align. Right, I've always noticed, you know, if you're building in the right market, growth will automatically come. And if growth comes within the team, the chemistry automatically sets better people want to join investors want to put in money, everything happens and market decides everything. So choose your market wisely. Everything else is very simply.

Krishna Jonnakadla  1:36:14

Assuming you haven't done really bad things in the way you set it up growth solves a lot of the problems that you nothing, nothing solves many of those problems that you always have, right? Everything. Two people are misfits. Obviously growth cannot solve that problem. What a reasonable job of getting most of the basics right, growth will, you know, put them on a different trajectory.

Ajay Kumar  1:36:38

So I've noticed, even with Bala and myself, and I think like all co founders, you have to fight at some point, and you can't let these. So such a great, you know, like fit that you guys never fight I think you'll end up having because two people working so closely, like nine entrepreneurs are typically larger than life personalities, it will flash which is fine. But I've noticed whenever we are growing, right, like, okay, we've had a great three months doesn't matter, either I'll compromise on a compromise. Right? It's when growth stagnates that, we start saying, Hey, you know, we did this wrong, we did that problem that leads to, you know, like confusion. And you know, like, it kind of like further alleviates existing problems, growth and sales, that is basically the magic pill, which will solve everything. And a big driver in that, you know, you could have started any edtech company 12 months ago, and you'd be doing great right now. That's right. I mean, obviously, you wouldn't have known that code was going to happen. But I don't know a single edtech company, which is having challenges right now. Right? Like in any aspect, they can use the money that they want, they can hire the people that they want, they can do whatever they want, right? And that's only because of the market, not because of the founding team or the product or the market. This is a text moment in the sun. See if you can figure out what is which industry is going to have its moment in the sun and build in that market.

Krishna Jonnakadla  1:37:48

Awesome. Well, I know. Yeah. You're so humble. And in spite of all the growth you've had, it is so refreshing to see the humility, anybody else in this seat with this kind of success. I'm not saying it's gargantuan, but you have a game going on. And you know that, right? You know that you figured out something, and you know that you're creating a meaningful difference. And this is only the tip of the iceberg, right? Like we spoke about, there are so many other aspects of the real estate game that could be taken. Yeah. And you reasonably solved one part of it, which is a property management part of it. And once you have that state stabilized, there are other things that you can take on which are adjacencies. Correct. So I think you're well positioned for that. And, you know, your humble leadership and your humility, I'm sure will hold you good Maharajas of Scale, we'll come back and talk to you when you scale. Another other point and be to see what that vantage point looks like. It was fabulous having you on the show, and we wish you the very best.

Ajay Kumar  1:38:51

Thank you so much for having me here. And I hope the audience got something meaningful out of this as well.

Tania Jadhav  1:38:56 We hope you enjoyed this story. If this story made a difference to you, tell us by leaving the comment on the website, or our social media channels. help us spread the love by subscribing, liking and sharing our show. We welcome speaker suggestions and collaboration. Write to me at