Proptech Sector’s Resurgence in 2024: A Year of Fundraising and Growth
The proptech sector experienced a significant upturn in 2024, with funding reaching $416.49 million, led by major players like Oyo, HomeLane, and Rentomojo.
This resurgence comes after several years of decline, with leading startups such as Oyo, HomeLane, and Rentomojo taking the lead in fundraising.
Established players like Oyo, WeWork India, and Livspace also dominated in terms of revenue, supported by both domestic and international investors, including AC Ventures, Accel, and Blume Ventures.
Year-on-Year Funding TrendsThe proptech sector has seen significant fluctuations in funding over the past few years, reflecting broader market dynamics and investor sentiment.
In 2021, the sector attracted a hefty $1.31 billion.
However, this figure dropped sharply to $632.5 million in 2022 and further declined to $122.81 million in 2023.
By 2024, the sector began to recover, with venture fund inflows surging to $416.49 million.
Leading Fundraisers of 2024Among the top fundraisers in 2024, Oyo, a leading player in the hospitality sector, secured the highest amount at $175 million.
HomeLane, a platform for home interiors and renovations, raised $27 million, while Rentomojo, a furniture rental brand, secured $25 million.
Anarock, a real estate consultancy firm, raised $24 million.
Other notable fundraisers include Amber, which raised $21 million for global student housing, and Smartworks, a co-working space provider, which secured $20.24 million to expand its footprint.
EPACK, a provider of turnkey solutions for pre-engineered buildings, also raised $20 million.
Financial Performance of Leading Proptech Companies in FY24In FY24, Oyo led the pack with an operational revenue of Rs 5,388.79 crore, followed by WeWork India, Livspace, and Smartworks, which generated revenues of Rs 1,665.14 crore, Rs 1,185.73 crore, and Rs 1,039.3 crore, respectively.
Other top revenue-generating firms include Square Yards, Awfis, IndiQube, SILA, HomeLane, and Simpliwork.
Profitability was a key highlight, with several startups achieving significant profits.
Oyo reported a profit of Rs 229.58 crore, largely due to exceptional items such as the fair value gain on the acquisition of OYO Hotels Cayman and the reversal of financial liability.
Isprava, a real estate solutions provider, reported a profit of Rs 62.71 crore, while Anarock followed with Rs 44.94 crore.
Despite these achievements, some firms like Livspace, IndiQube, Housing.com, and WeWork India faced significant losses, with Livspace leading the list with a loss of Rs 413.82 crore.
However, these firms are implementing cost-cutting measures to improve their profitability.
Leading Investors in Proptech StartupsThe year 2024 saw significant investments from both domestic and international venture capital firms, signaling growing interest in proptech solutions.
Prominent investors such as Z47 (Matrix Partners), Accel, Inflection Point Ventures (IPV), Blume Ventures, and others played pivotal roles in supporting the sector.
Other active investors include AC Ventures, Singularity Ventures, Stellaris Venture Partners, and Peak XV’s Surge Ventures, which funded a diverse range of tech companies including Accacia, Stanza Living, HouseEazy, Wify, and more.
Consolidations in the Proptech SectorThe proptech sector saw only three major merger or acquisition deals in 2024.
The biggest deal was Oyo's acquisition of G6 Hospitality, the operator of Motel 6 and Studio 6, for $525 million.
Oyo also purchased Paris-based premium rental homes company Checkmyguest for $27.4 million.
Additionally, HomeLane announced its offer to acquire DesignCafe, a leading player in the home interior market.
Race to IPOsAwfis became the first Indian co-working startup to go public, marking a significant milestone for the industry.
Smartworks has also secured SEBI approval for its proposed IPO.
Media reports suggest that several other proptech companies, including WeWork India, Simpliwork, Table Space, DevX, and Indiqube, are gearing up for public offerings.
Oyo and Pepperfry are waiting for favorable market conditions to go public.
The co-working sector is expected to lead the IPO landscape within the Indian startup ecosystem in the coming years.
ConclusionThe proptech sector's success in 2024 is largely due to its easy-to-understand business models and predictability.
However, high costs in different areas, such as maintaining quality, logistics for product firms, and rental costs for co-working firms, continue to impact profitability.
Despite these challenges, the sheer size and potential of the sector mean that startups will not give up on the numerous opportunities available.
The journey has just begun, and the sector is poised for significant growth and evolution in the years to come.
Frequently Asked Questions
What was the total funding raised by the proptech sector in 2024?
The proptech sector raised a total of $416.49 million in 2024.
Which proptech company raised the highest amount of funding in 2024?
Oyo raised the highest amount of funding in 2024, securing $175 million.
What were the top revenue-generating firms in the proptech sector in FY24?
The top revenue-generating firms in FY24 were Oyo, WeWork India, Livspace, and Smartworks, with revenues of Rs 5,388.79 crore, Rs 1,665.14 crore, Rs 1,185.73 crore, and Rs 1,039.3 crore, respectively.
Who are some of the leading investors in the proptech sector?
Some of the leading investors in the proptech sector include Z47 (Matrix Partners), Accel, Inflection Point Ventures (IPV), Blume Ventures, and AC Ventures.
What major mergers or acquisitions took place in the proptech sector in 2024?
In 2024, Oyo acquired G6 Hospitality for $525 million and Checkmyguest for $27.4 million. HomeLane also announced its offer to acquire DesignCafe.
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