A few months ago, SoftBank-backed Housing awarded pink slips to around 600 people with plans to lay off 200 more
Just weeks after the Indian media reported on the massive lay-off at Housing, another Indian startup has handed over pink slip to 100 employees.
Mumbai-based Grabhouse, a VC-funded broker-free online rental platform, has laid off 100 staffers as part of its restructuring plans, according to Livemint.
In an e-mailed response to a section of media, Grabhouse’s Co-founder Pankhuri Shrivastava said:
“We have been forced to lay off employees due to restructuring of our business. This has been a tough decision for us and we are doing all we can to help people who have been let go. We have organised a special recruitment team to help these employees find their next role asap and will continue to support this effort any way we can. Grabhouse is increasingly focussing on creating better technology solutions that can connect home seekers and owners in the most efficient manner possible. As we continue to try and build stronger technology solutions, we are closing down the more operational parts of the business — this restructuring has forced us to make some tough choices. During this period, we will take all measures to ensure our customers and services remain unaffected.”
Also Read: Rahul Yadav fired from Housing as “behaviour not befitting a CEO”
Surprisingly, the development comes just a couple of months after the firm grabbed US$10 million in Series B round of funding from Sequoia Capital and Kalaari Capital — two leading VC firms in India. Previously, Grabhouse’s had raised US$2 million in Series A round from the same set of investors in November last year.
Founded in 2013 by Prateek Shukla and Shrivastava, Grabhouse is a rental property listing website for Indian cities. The platform claims to have served a million customers as of October this year. It has a presence across 11 cities in the country.
Is online real estate going though consolidation?
Over a dozen online real estate companies are operating in India, most of who are backed by large VC investors. The last three-four months have not been so great for many of these companies, as they either slimmed down operations or fired people in large numbers. This can be directly attributed to an over-all decline in the realty space in the country.
SoftBank-backed Housing started the lay-off drive by awarding pink slips to around 600 employees three-four months ago, as per The Economic Times. The same publication reported last month that the Mumbai-based startup is planning to lay off another 200 people to tighten costs.
This is in addition to a few M&A developments in the recent past. Last month, Google Capital-backed real estate portal CommonFloor.com agreed to merge with Mumbai-cased online classifieds company Quikr. Just two days after this report came out, Quikr announced the acquisition of realtycompass, a real-estate analytics platform that provides builder ratings and detailed project analysis to consumers.
In yet another incident, the Bangalore office of NoBroker — a VC-funded online real estate marketplace that connects flat owners and tenants directly with each other by eliminating middle men — came under attack from around 40-50 people in September, allegedly brokers, for “the disruption it is causing in the market”.
If these are any indications, not all is well in the real estate industry in India. The segment, which has been a darling of VC investors for the past two years, is going through a consolidation of sorts. Eventually, large sharks will gobble up small fishes, and only two or three players will monopolise the industry.
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