New Delhi: Gurugam-based home rental marketplace Fastfox is in advanced talks to raise a $10 million Series B round from new investors, including venture capital and private equity firms, a top company executive said in an interview. Fastfox, run by Oku Tech Pvt. Ltd, is backed by LightSpeed India Partners, Blume Ventures and CyberAgent Ventures. It has raised nearly $7 million so far, including a $1.5 million extended Series A round in February, which marked the end of a funding drought in real estate startups.
Founded in 2016 by Pallav Pandey and Mukul Bhati, Fastfox also counts Anshul Gupta and Sidhharth Singh as co-founders. It claims to use Artificial Intelligence and Machine Learning to match residential units with customer preferences, based on 108 data points, including interiors, distance from daily utilities and availability of parking, among others.
“Indian and Chinese VC majors have shown active interest, and are doing their valuations right now," said Fastfox senior vice-president Anshul Gupta, adding that the round is expected to close within a month or two.
The home-rental company had recently adopted an open house model, mostly prevalent in the West, which allowed property seekers to visit listed homes during designated timings, eliminating the need to coordinate with a broker or the home owner.
The shift has contributed to a fourfold growth, the company claimed.
“We are witnessing strong customer adoption of the open house across different segments of our users, including families and bachelors. We are looking forward to tap into this prevalent demand and would like to ensure adequate capital before we roll out nationally," said Fastfox chief executive Pallav Pandey.
The startup plans to use the capital to expand its services in Delhi, Mumbai and Bengaluru, besides building base in Pune, where it is conducting a pilot.
“Much of the utilization will be for expansion across Tier 1 cities and inventory aggregation. We will also be hiring across the board, including operations and technology," added Gupta.
According to Fastfox, the Indian home rental market is worth $32 billion at the moment and is expected to grow 10-15% year-on-year.
As it expands to newer geographies, it will be direct competition with SAIF Partners LLC-backed No Broker, which claims to have served 3.5 million customers in Gurugram, Chennai, Bengaluru, Mumbai and Pune.
Fastfox primarily serves the Gurugram market with gross contract value run rate of $24 million. It is targeting a gross contract value of $45 million by the end of the financial year.
Apart from handling the paperwork for its clientele, Fastfox is piloting a monthly subscription-based service to home owners in Gururgam. It seeks to offer end-to-end property management on behalf of landlords, including property review and maintenance.
“The property maintenance process is painful, which is why a lot of houses are also vacant. It is a property management light model, unlike the heavy ones in the market, and will allow customers to manage this remotely without spending a bomb," said Gupta.