Tiger Global, Accel invest $7.5 million in CommonFloor.com

The funding is primarily for setting up offices in multiple cities, enhancing technology and products

 

This is the third time the website has raised capital from Accel and the second time from Tiger Global. Photo: Bloomberg

Bangalore: American hedge fund Tiger Global Management Llc and venture capital (VC) firm Accel Partners have partnered to invest $7.5 million (about Rs.45 crore) in real estate website CommonFloor.com.

This is the third time the website has raised capital from Accel and the second time from Tiger Global.

The latest funding is primarily for setting up offices in multiple cities, enhancing technology and products, and expanding in existing markets, said Sumit Jain, co-founder and chief executive, CommonFloor.com.

“This round of funding by our existing investors is a vote of confidence in our business model and traction that we have built in a short time through our differentiated offerings,” said Jain.

In 2009, the company raised capital from Accel Partners and last year from both Accel and Tiger Global. The investment amounts in both these deals were not disclosed.

The six-year-old firm, which combines online property search and apartment management among other requirements, has launched a mobile application for users with features like map search using a phone camera.

Investments by VC and private equity (PE) firms in the fast-growing but still nascent property website space have been substantially growing every year.

Such investments rose to about $12 million across seven deals in 2012, from about $3.9 million in two deals in 2011, according to estimates by researcher VCCEdge and Mint based on disclosed transactions.

In 2013, so far, there have been five other investments in property websites—three of these adding up to $18.8 million; details on the other two were not disclosed.

With significantly increased Internet penetration in India, it’s natural to project that a large part of property research will happen online, especially through neutral information providers such as CommonFloor, said Subrata Mitra, partner, Accel Partners.

“At Accel, we’re great believers of online efficiencies to be brought into large markets, and therefore CommonFloor was a natural investment target,” Mitra said in an emailed response. “We believe the company can dominate several large metros in India for real estate-related listings and research, and therefore the decision to double-down to enable the company to grow rapidly.”

Tiger Global, which has previously invested in travel website MakeMyTrip Ltd, didn’t respond to an email query.

PE firm Indus Balaji, which invested in Perfect Pincode in 2012, recently again invested $2 million in the Hyderabad-based property search company. “When the markets are a bit slow, it is a good time to invest,” said Mohit Ralhan, managing partner at Indus Balaji.