Square Yards has recorded over 75% growth in 2018, and has far outstripped its previous year’s gross transaction value, facilitating over 11000 real estate transactions. The company also announced recently that its India Primary, NRI and Mortgages business also registered a GTV of around ₹5,000 crores in the same time frame.
However, back in 2013, the company was only 3 members strong, an underdog that began in Hong Kong. Now, the company employs over 2,200 employees and operates in over 10 countries worldwide. With a presence in 13 international cities, such as Abu Dhabi, Sharjah, Muscat, Melbourne, Singapore, Sydney and Toronto, the company has begun the expansion plans that afforded the growth of last year.
The company then acquired multi-country real estate licenses and entered into collaborative arrangements with leading International developers. Through these agreements, Square Yards were able to secure exclusive and territorial selling rights, permission to conduct events and road-shows and facilitate e-commerce transactions.
Analytics India Magazine got in touch with Vivek Agarwal, the co-founder of Square Yards, To know more about the company’s journey from a nimble startup to an unstoppable force fueled by data analytics and proprietary technology.
The firm’s primary business models were real estate and mortgage terminations. Later, Square Capital sprung up to handle mortgage-related financial services as well. Here, Square Yards functions as a distributor, with their primary goal being to tie up with principals. This includes real estate developers and FSIs such as banks. They achieve a worldwide distribution of their products by utilizing PropTech, with their primary source of income being closing deals with principals. This allows them to provide their services without charging the customers, thus increasing their reach.
Agarwal provides insights on the real estate market, stating, “Traditionally, real estate and mortgages are slow to adopt the technology. They are not really using technology at scale. From the very beginning, we were clear that we would bring technology and analytics and scale our business based on these fundamentals. We were able to very successfully do this over the last few years, and our entire business now runs on tech.” This, according to Agarwal, is one of the key differentiators that allows them to bring innovation to the market. The other is execution, he says. This sets Square Yards apart from the incumbents and other startups in the market, as they have executed the business based on strong business fundamentals and sticking to the unit economics.
Agarwal details that real estate was the primary focus of the company was starting with real estate, with mortgages coming later. He said, “The idea was to understand the value chain. So as to better control the product selection, reduce our own tax for disbursement, and pinpoint some pain points.”
The Tech Behind the Magic
Square Yards utilises technologies such as Angular and React.js for their forward-facing products, thus providing a new-age experience to consumers. They place additional importance on aggregating data and doing analytics on it. This has led to the creation of advanced research tools available for use by consumers on their website. One of their research tools is a heatmap of properties in a given city, which show the price of properties across the region. They also include an automated need-based recommendation system for properties to buy, which provides an automated and unbiased output based on their algorithm. The system judges factors such as budget, purchase timeline, and unit preferences, using this information to provide a list of sectors in the city where suitable properties are found. This is meant as a kickstart to the real estate investment searches of users.
They also have the option for users to view a scatterplot of properties across the city in a size vs price comparison. This includes filters such as price, zone and location, connecting roads, project attributes, unit preferences and developer preferences. Agarwal details the place these services hold in Square Yards’ position, stating, “These are what we have built as a base, which are more advanced data and analytics technology. What we are moving into is more of predictive capabilities, where we are engaging in ML-based lead assignments, a consumer PWA, a customer care control, service experience. The technology is the batsman but analytics fuels the adoption.”
Square Yards’ emphasis on data analytics has enabled them to solve the data asymmetry faced by a real estate buyer, by providing superior search, discovery and research tools. This is indicative of their approach to bring data analytics to the user. Agarwal also mentions that the use of analytics has enabled standardization, stating, “It has brought standardization in our processes, in the way we generate leads, manage leads and nurture leads, and in how we meet the clients. It has helped us reach a wider target audience, and scale our processes. So earlier, we used to reach 1,000 people in a day, with the use of technology we are able to reach hundreds of thousands in a day.”
Mending The Broken Value Chain
Due to the fragmented nature of the Indian real estate market, Square Yards have taken it upon themselves to begin laying the foundation for a more unified real estate environment. This has resulted in the company building platforms for each part of the value chain. They have already implemented the use of a consumer web portal and a progressive web application. They have also created a sales agent app, along with a mobile app for brokers. Coupled with this, the company is also building technology platforms for easier integration with developers and banks. Agarwal says, ”We are covering a gamut of all the players in real estate. We hope to implement this not only across India but other countries as well. For example, in Dubai, we are replicating the same technologies, and we have already become one of the biggest players in Dubai’s real estate markets.”
This has also led to the planned expansion of Square Yards into 3 more countries in the Gulf, namely Kuwait, Bahrain and Saudi Arabia. This bolsters their already strong presence in the Gulf, thus providing a foothold for one of the biggest real estate giants in the world.
Square Yards’ products offer synergy with Square Capital, as the latter provides a mortgage to the customer who engages in buying a product on Square Yards. Square Yards also offers a product catering to international real estate, which also has a synergy with Square Capital. Agarwal states, “We are looking into products such as insurance and wealth management very seriously, we have already started on a small note. We are looking at a whole gamut of financial services, be it wealth management, or insurance.”
Square Yards currently has a few products under development, with one of the products being real estate sales and distributions platforms for builders, built on a SaaS architecture. Reportedly, this will allow the builder to manage leads, site visits and mortgages. Agarwal details more upon this product, stating, “We will be integrating with banks for this platform so that the mortgage disbursement also happens within a period of time. We are creating an ecosystem where there are real estate buyers, brokers, builders as well as banks, and they are on the same platform. They are able to do their transactions faster and more efficiently.”