“After multiple rounds of conjecture, and high drama, the 26-year-old co-founder of real-estate portal Housing.com has been fired from his job.”
The above lines has been deliberately put in inverted comma, to remind you of all the stories and news that were on buzz when the similar happened. Yes! we are talking about Rahul Yadav, the ex-CEO of Housing.com.
Rahul was one of the 12 co-founders who were the roots of the startup’s formation. Unfortunately, at a board meeting on July 1, 2015, the shareholders and the investors took a joint decision to expell the CEO out of Housing.com
“The Housing board, unanimously agreed to bring Yadav’s tenure to a close, with reference to his behaviour towards investors, ecosystem and the media,” the company said in a statement. “The board believed that his behaviour is not befitting of a CEO and is detrimental to the company.”
The Rise of Rahul Yadav
Rahul Yadav studied at IIT Bombay where he becomes the class represantitive and the secretary of the student association. During his period of study there, he created ExamBaba, an online portal with a collection of old question papers for the students of IIT.
After dropping out of IIT, Yadav and 11 others launches Housing.com in Mumbai. Sources say that the idea boggled the mind of Rahul Yadav, when he went looking for a house in Powai, a mumbai suburb, where the IIT Bombay campus is located.
And that let him understand the challenges of house hunting in India. Set to solve the problem, Housing.com was brought to existence. The startup raises an undisclosed an undisclosed amount of money from angel investors including Zishann Hayath.
Zishaan is the co-founder of Chaupaati Bazaar and the former vice-president at Future Bazaar. The investment was in the month of February 2013.
In March 2013, Haresh Chawla, former Network18 chief executive officer and managing partner at India Value Fund Advisors, invests an undisclosed amount of money in a second round of funding.
Housing.com sets up milestones in Hyderabad, Pune and Gurgaon. The company secures its third round of funding, worth $2.5 million (Rs15.9 crore), from Nexus Venture Partners.
The fourth round of funding raises $18.08 million (Rs115 crore) for the startup. Investors include prominent venture capital (VC) firms like Helion Venture Partners, Nexus Venture Partners, and Qualcomm Ventures.
Japan’s Softbank invests $90 million (Rs572 crore) in Housing.com. The funds, Housing says, would be used to map over 40 million houses across 300 cities in India.
The company goes on a hiring spree and outlines plans to hire some 500 employees from the IITs and other topflight engineering schools. It also spends heavily on advertising campaigns.
The Problems at Housing.com
Everything was going well and Housing.com already set a mark on the Indian startup eco-system. But, we all know there are ups and downs in every startup.
Rahul wanted Housing.com to first focus on customer base rather as a business model but somewhere investors were not convinced with that. As a CEO and Founder he only owns a small part of housing which was valued at Rs 70 crores in the market.
The hallmark of Yadav’s personality has been his pugnacious attitude, something that has helped him build one of India’s most high-profile startups while also being a magnet for controversy. In three years, Housing has emerged as one of the Indian startup ecosystem’s prime success stories with $121 million (Rs 750 crore) raised from investors.
On the other hand, Yadav has alienated many people within Housing and triggered fights outside that could distract from building the company. If there’s one thing almost everyone finds agreeable about him, it’s his boundless passion – an irreplaceable startup founder attribute.
“I’m not (running Housing) for the money. That’s the kind of clarity I want to give people,” Yadav told ET, explaining what he wanted his generosity to convey. (While Yadav says his stockholding translates to Rs 150-200 crore, some investors argue that based on Housing’s current valuation of Rs 1,500 crore, his ownership is worth about Rs 70 crore.
“I was class representative of my batch and then I was institute secretary. I knew the best people in IIT-Bombay for various functions likeback- and front-end programming, UX (user experience) and communications,” Yadav told ET. In 2012, Yadav pooled his savings to start Housing, earning him the title of CEO.
The Fall Of Rahul Yadav
Yadav asks Shailendra Singh, managing director at private equity firm Sequoia Capital, to not “mess” with him and his company. Singh had reportedly offered a job to a Housing.com employee, which ticked off Yadav.
In his email to Singh, he wrote:
I’ve been humble to you guys even after inhuman and unethical things that you’ve done with Housing in the past.
You did the same inhuman and unethical things with large number of entrepreneurs including Ola, TFS, Flipkart, Dexetra and many more…
Now I just came to know you personally are completely after Housing’s employees and are brainwashing them to open some stupid incubation.
If you don’t stop messing around with me, directly or even indirectly, I will vacate the best of your firm.
Also, this mark the beginning of the end of Sequoia Cap in India.
India’s largest media house, the Times Group, sends a legal notice to Housing.com and seeks Rs100 crore ($16 million) in damages from the company. Yadav had reportedly claimed in an email to his employees that the Times Group was out to malign Housing.com.
Times Group owns MagicBricks, a real estate search portal and a competitor. Yadav quits as the company’s CEO, with this scathing email to investors:
“Dear board members and investors,
I don’t think you guys are intellectually capable enough to have any sensible discussion anymore. This is something which I not just believe but can prove on your faces also!
I had calculated long back (by taking avg life expectancy minus avg sleeping hrs) that I only have ~3L (hours) in my life. ~3L hrs are certainly not much to waste with you guys!
Hence resigning from the position of Directorship, Chairmanship and the CEO position of the company. I’m available for the next 7 days to help in the transition. Won’t give more time after that. So please be efficient in this duration.”
A day later, Housing.com says that Yadav has agreed to withdraw his resignation after a board meeting. “Today the Housing board met, and has been reconstituted to include all main shareholder representatives. After some good conversations the board has reaffirmed its faith in Rahul Yadav’s vision at Housing,” the company says in a statement.
Yadav announces that he is giving away his stake in Housing.com to its employees. The shares are estimated to be worth between Rs 150 and Rs 200 crore ($23.58-31.44 million). “I’m just 26 and it’s too early in life to get serious about money etc,” Yadav explains.
The co-founder is sacked. “Yadav who is also the co-founder of the company, will no longer be an employee of Housing and be associated with the company in any manner, going forward,”the company says in a statement.