Entrepreneurship
Saurabh Garg
(PGP 2004)
Co-founder of NoBroker.com
Box:
- Saurabh Garg and Amit Agarwal co-founded NoBroker.com. It became India’s first property tech unicorn, posting a money valuation of $1.01 bn and raising a total of $361 mn from investors, including Paytm’s Vijay Shekhar Sharma.
- NoBroker is the world’s largest C2C platform helping more than 7 lakh people find a home every year without paying any brokerage. This is a gross transaction value of Rs 64,000+ crore. It helps save brokerage worth more than Rs 4500 crores every year.
- He is a regular speaker at start-up events and forums, including IITs/IIMs/Incubators motivating students and start-up enthusiasts and helping them learn from his experience.
- He is an Advisor/Mentor and angel investor to more than 30 start-ups, many of which have grown to large scale. Three of these start-ups are run by IIMA alumni.
What does this award mean to you?
This award is a special and an important award for me because it’s from my alma mater. This award is not for me alone, this is for my co-founders, for the entire NoBroker team, who worked so hard to make this dream a reality. It’s important that the Institute thinks that I am on the right track. Getting a pat on the back from people who are much wiser than me feels good. This award also brings me a sense of responsibility, to keep striving for excellence, to do better, to contribute back to society back to the ecosystem, to help my fellow entrepreneurs, and to help younger entrepreneurs develop the entrepreneurship ecosystem.
When did you think about being an entrepreneur?
I was very clear from the very beginning of my life that I wanted to be an entrepreneur. I also attempted some startups at IIT during the dot com boom. And I realised that I don’t understand the business well. So after IIT, I had two options. Either I could go for a Master’s in finance– I had offers from the London School of Economics and Columbia University. I came to IIM Ahmedabad because I felt that it would give me an overall better understanding of the business– how companies are built, how companies are run and different parts of business like marketing, strategy and operations. One of the big reasons for choosing IIM Ahmedabad was that I felt it would help me do better as an entrepreneur.
What are the key elements that enabled you to grow NoBroker.com?
We started No Broker with a mission to change the world. We realised that lakhs of people like us or crores of people like us pay a huge amount of brokerage every year, every month whenever they’re changing houses or even commercial properties. The amount of brokerage paid in India every year is Rs 140,000 crores. So we were very clear that we have to make this much more seamless and cost-efficient. This is what we started with. Today, we have 16 million monthly active users and there are four or five things which made us succeed. First, focusing on the customer problem was very important. We focused on connecting both parties directly with no broker involved. We also made sure that we kept listening to what the customer was saying; a lot of people make this mistake that after starting the company they stop listening to customers. The customer said they are finding the property but there are other problems—doing legal documentation or finding a home loan. So we launched a lot of these services and made it into a one-stop shop to enhance the customer experience. Third, many people forget that the real estate market is a micro-locality business. You need to have depth in the cities where you are present. So even after almost 10 years, we are present only in six cities but we are the strongest there. Next, I think frugality is very important in a startup a lot of times. One of our competitors, who raised a huge amount of money, spent $20 million in advertising in three months. We spent $20 million in five years of our existence. And lastly, I would say having a great team. You, as founders, can do limited work, your next-level team needs to be very strong otherwise you will be caught up in just the operational issue.
What are your thoughts on the path to profitability for the start-ups in the Indian ecosystem and specifically for NoBroker?
For any company that exists, there are two objectives. One is to solve a customer problem, and make things easier for the customer and the second, is to generate profits for its shareholders. It doesn’t matter whether it’s a startup, whether it’s a listed company, whether it’s a traditional company, I think this is a reason for existence. So clearly, profitability is at the core of what a company should be doing. So at No Broker, we had two choices very early, should we be small and become profitable very quickly? Or should we become very large, and become very profitable? I think that’s what we made because it’s a huge network effect business. So we said, let’s let the network effect come in, that the snowball effect comes in, and the profitability will follow that path. So that’s where we are. We think that we will hit profitability in the next 18 to 24 months. It seems very possible to do that. We’re on the right track. The metrics are looking good. And I think the current environment, the current ecosystem, has matured a lot from saying growth at any cost to saying sustainable growth. You know, everybody’s asking the right questions, what are unit economics? When is EBITDA coming? So I think it’s great. It’s great for the entire startup ecosystem in India because we will generate a lot of companies who will, who will create value for the shareholders.
What would your advice be for people looking at entrepreneurship as a career?
My advice would be that, like, I always say that this is the best time to start a company in India. India’s at a place where it’s going to be a global economic superpower in the next couple of decades, probably the second-largest economy. People should think of entrepreneurship as an option.
There are 4-5 learnings I have from my experience. First is to focus on the customer’s pain point and never stop listening to the customer. Second, make sure that you know the business or the market is large enough to justify taking this risk. Thirdly, a team is very important, you should make sure that your next level of the team is as good or better than you because those are the guys who are going to make your dream into reality. Fourth is persistence– entrepreneurship is not easy, and being illogical at times is important. Lastly, it is a very lonely journey, you need to have great co-founders because when the bad times happen, it’s only the co-founders who understand each other and can support each other.
