KKR Pumps $145 Million Into Southeast Asia's Top Property App
(Bloomberg) -- PropertyGuru Pte has pulled in S$200 million ($145 million) from KKR & Co., raising funds for the first time in three years as Southeast Asia’s largest real estate portal prepares to delve into new business areas.
The series D financing will help the startup take full control of leading Vietnamese real estate site Batdongsan.com.vn, after buying a minority stake in 2016, PropertyGuru Chief Executive Officer Hari V. Krishnan said. The number of people visiting Batdongsan has doubled to 4 million a month since that investment.
The new funding will also help the Singaporean company explore businesses such as mortgage financing, he said. It will be used as a “warchest for opportunities that will materialize in the next 12-18 months,” Krishnan said in an interview.
“After three and a half years of organic growth, we felt that it was the right time to go out” and seek funding, Krishnan said.
He was appointed as CEO in 2016, taking over from PropertyGuru co-founder Steve Melhuish, who remained vice chairman. With this investment, KKR will be one of the biggest investors in PropertyGuru, alongside TPG, according to Krishnan.
For KKR, PropertyGuru represents the latest in a series of deals intended to hitch a ride on new technology adoption around the region. Its other Southeast Asian investments include Indonesian ride-hailing giant Go-Jek and Voyager Innovations, a digital payments service in the Philippines.
“It’s actually not easy to find a tech company in Southeast Asia that has established some form of leadership in their space with the runway to keep growing in the next five to 10 years,” Ashish Shastry, head of Southeast Asia at the private equity giant, said in the same interview. “PropertyGuru is one of those rare companies.”
Launched in 2007, PropertyGuru is profitable and has a positive cash flow, according to Krishnan. Its annual revenue has grown an average of about 25 percent annually from 2016 to 2018, and the company expects to maintain a similar pace over the next three years, he said.
Its last financing round was in 2015 when it secured S$175 million from TPG, Indonesia’s Emtek Group and Square Peg Capital. Its website and app let users search for real estate by location, type and price, and see photos of interiors along with floor plans. The company operates in Singapore, Malaysia, Thailand, Indonesia and Vietnam with 25 million property seekers visiting monthly.
“Southeast Asia is still a new investing landscape for major strategics,” KKR’s Shastry said. “We hope to have a chance to ride the wave up and catch some of the really exciting companies early.”
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