These Entrepreneurs are Making Renting Houses in Mumbai an Easier Task
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The world is getting compact and the cities are becoming denser, ironically to an extent that we don’t know much about our neighbors too. We live in silos today. But that’s a pain too. In organized housing societies, apart from knowing neighbors to engage yourself in a community, the problems for such societies are unstructured services and compliance management.
And technology alone has failed to address it. Mumbai-based Zipgrid - a community platform for offering technology-led services to housing societies aims at reinforcing the welfare of the residents’ in resident welfare associations (RWAs).
Zipgrid was launched by Kunal Gupta - former investment manager at Mapletree Investments (real estate focused private equity fund as part of Temasek Holdings) in Singapore along with Jaydip Popat in mid 2013. When Gupta came back to India, renting an apartment in Mumbai was nothing short of a task. While there have always been RWA committees steering the society’s work but the structure Gupta realized has been very inefficient.
“The ways things are managed are quite unstructured as the committee members don’t have any authority per se because it is a very democratic set up. That’s the crux of the problem. In Mumbai I wanted to rent an apartment and it took a lot of time only to get all the paper work done,” says Gupta.
Zipgrid get annuity service contracts from a society’s committee and are monthly paid for the services including payment collection, maintenance, accounting, compliance and control management. This is first of its kind in India and different from software as-a-service based society management solutions where the services are still have to carried out by committees.
Zipgrid charges depend on the level of services taken by societies and the number of apartments in the society. “We have the first move advantage in this space. We are the outsourced management office for the RWAs and our basic services include finance and compliance management. It starts with around Rs 100 per flat per month to a few hundred rupees,” says Popat.
Putting House in Order
The duo had started out by renting a small office space in Mumbai with their personal investments. The first year was spent on the learnings and getting the first society contract even as the company got registered towards the end of that year.
“There was no take home salary for both of us for the first three years and we worked for around 16-17 hours a day including weekends. Even when at home, the work continued,” remembers Gupta. While the number of hours has come down to around nine but both still have weekends dedicated to work.
The start-up crowdfunded the business with $200k through crowdfunding platform 1Crowd in August last year followed by $500k round from global real estate services firm JLL India along with 1Crowd. Zipgrid renamed itself from its earlier name - MyAashiana Management Services as “people thought us to be a real estate business,” asserts Popat.
Zipgrid signifies network of pin codes where Zip denotes pin codes while Grid means network. The start-up currently manages around 125 societies, around 90 per cent of which are in Mumbai and rest in Ahmedabad. The market in Mumbai in fact is quite large that has got Gupta and Popat hooked to it before looking outside even as across India the potential is overwhelming.
Popat explains, “There are around 100,000 societies in Mumbai and Mumbai region. Across India, there are around a million organized RWAs and the top five cities in India perhaps have more than 40 per cent of the market.” No doubt, the start-up is sitting on a gold mine. “We are looking at around Rs 2,500 crore of annual revenue potential only in residential segment for the services we provide,” claims Gupta. Now with JLL India coming in, Gupta and Popat are now looking at diversifying their revenue base.
(This article was first published in the July issue of Entrepreneur Magazine. To subscribe, click here)