NoBroker battles COVID-19 to become India’s first property-tech Unicorn

NoBroker raised $210 million, last week, raising its valuation from $350 million (in April 2020) to $1 billion, becoming India’s first prop-tech unicorn.

30th November 2021
3 min read

In a nutshell

NoBroker began in a crowded yet large industry, to build a tech-based, brokerage-free real estate platform.

Like its competitors, finding profitability has been tough - while it has tripled its revenue each year, even in FY20 its losses were almost 3 times its revenue!

Yet, the company raised $210 million, last week, raising its valuation from $350 million (in April 2020) to $1 billion, becoming India’s first prop-tech unicorn.

VCs have still shown interest, likely due to the general positive funding climate, but also because of NoBroker's foray into gated society software, NoBrokerHood, that shows potential for various business models to be laid on top of it.

The plans to aggressively expand into 50 cities and to build its software platform are interesting moves, but this remains a tough & competitive space. So, only time will unfold its future outcome :)


The latest addition to the list of 30+ Indian startups to get the unicorn status this year is NoBroker. At this point you may just be reading this and be saying "Oh, great, another one". But, a unicorn in the tough Real Estate industry? That's new.

With the onset of the Covid-19 pandemic, the real estate sector was one of the worst-hit. Becoming India's first proptech (property + tech) unicorn during such a challenging time is definitely something that deserves attention.

So, my attention it has. I started researching around it and condensed it in this quick 2-min read. Let's go!

Was there a need for a firm like NoBroker?

Well, house hunting is a pain. That's not new. But, even before NoBroker existed, we had companies that made buying or renting places online possible, such as MagicBricks, QuikrHomes, etc.

Now, NoBroker noticed that such platforms were often just marketing platforms for brokers i.e. the listings weren't made by owners. So, why not eliminate the middlemen?

That was NoBroker's plan - a tech based, brokerage-free, real estate platform.

There are a couple of things to learn here for entrepreneurs:

  1. Presence of competitors doesn't mean a successful startup can't be built in the space.
  2. Extending the above point - in a big industry, there can be many winners.

Hmm, so how's its business performing?

Even with competition, NoBroker has been able to steadily triple its revenue each year. It claims to have 15 million+ registered users across six cities and clearly that is only going to grow further.

That sounds quite positive. The NOT so good catch is that the company spent almost 3 rupees to earn each rupee of operating revenue in FY20 i.e. its expenditure was over INR 179 crore, while the revenue was INR 63 crore.

So, yup, we have another Unicorn that is burning cash to find growth. Also, this is not a recent symptom for NoBroker - it's been the case from inception.

To put it in context though, the entire industry has been having a tough time - competitors such as MagicBricks and 99Acres that have been around for far longer have only reported slim profits.

Then why are VCs so interested in it?

Just last week the company raised a whopping $210 million (~INR 1600 crores) that took its valuation from $350 million (in April 2020) to $1 billion. With this, it has become India's first prop-tech unicorn.

But, why would VCs put that kind of money in a company placed in a tough industry AND one that's burning a ton of money? Hmm, not an easy answer, but some points are:

  1. While markets are poor globally, the investments in the Indian proptech sector grew in 2020, albeit marginally from $549 million to $551 million.
  2. It definitely helps that property is considered an important asset to invest in - not for a quick buck but in the long-term.
  3. NoBroker has diversified into providing software, called NoBrokerHood for gated societies - currently at 10,000.
    • Now, this platform allows for it to lay various different business models on top of it - home loans, packers & movers, legal, etc.
    • It is already allowing 3rd party brands to sell to residents through this platform.
  4. I say this grudgingly, but to an extent, the generally positive funding climate seems to have helped the deal :)

What happens in the "long run"?

The real estate is brutal and a crowded space. NoBroker has to battle with over 10 big competitors, many who have been in the industry for way longer, with some even reporting profits.

However, this is an industry where quick inroads is tough. So, the company that is able to execute well in the long-run will see the maximum gains.

This money does help NoBroker to expand aggressively - it plans to expand to an additional 50 cities. However, it also understands the challenge of staying tied to the "traditional" proptech model.

So, there is surely going to be a lot of money poured into the NoBrokerHood software platform. While that's a really interesting play, whether it works is something we will have to wait & see :)

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