reporter2
28-09-21, 12:20
PropertyGuru to bet on fintech, S-E Asia markets as it gears up for SPAC listing
Sep 28, 2021
AS PropertyGuru gears up to go public through a merger with a special purpose acquisition company (SPAC), its growth story will rest on leveraging opportunities in South-east Asia and its nascent - but expanding - fintech & data business segment.
In July, it was announced that PropertyGuru would trade on the New York Stock Exchange via a partnership with blank-cheque company Bridgetown 2 Holdings, backed by billionaire Peter Thiel and Hong Kong tycooon Richard Li, to create a combined entity with an enterprise value of around US$1.35 billion and an equity value of about US$1.78 billion. The deal is expected to close in Q4 2021 or Q1 2022, subject to the necessary approvals.
Singapore-based PropertyGuru - which counts TPG Capital, KKR and Australia's REA Group among its shareholders - will raise some US$431 million in gross proceeds, which will be channelled towards both organic and inorganic growth.
Of course, this isn't the first time the online real estate firm has sought to go public. An earlier attempt at a listing on the Australian bourse in 2019 was shelved over valuation concerns. It later went on to raise about S$300 million in September 2020 in funding rounds led by TPG and KKR.
Part of PropertyGuru's growth story is the opportunities that lie in its backyard. The South-east Asia region is poised to become the world's fourth largest economy by 2030, with increased Internet penetration and an emerging middle-class that will bolster the housing market.
While Singapore comprised nearly 57 per cent of revenue for its property agent & developer business in 2020, its other key fast-growing regional markets such as Malaysia and Thailand are expected to account for a greater proportion of revenue by 2025 than they do at present. In May this year, PropertyGuru announced it was acquiring REA's businesses in the two countries, including iProperty.com.my in Malaysia and thinkofliving.com in Thailand, to strengthen its capabilities as a proptech firm. In return, REA received an 18 per cent stake in the enlarged PropertyGuru.
Expanding footprint
Founded in Singapore in 2007, PropertyGuru has expanded its footprint to five South-east Asian markets, with over 49,000 active property agents, 37 million monthly property seekers and over 2.8 million monthly real estate listings. A large chunk of revenue comes from property agents/agencies who advertise on its marketplace, as well as digital sales and marketing solutions for property developers.
As the pandemic hit, group revenue tumbled from US$66.6 million in 2019 to US$61.9 million in 2020, but is projected to swell to US$222.6 million by 2025, according to an investor presentation released in July. Prior to the pandemic, revenue expanded at a compound annual growth rate (CAGR) of 25 per cent between 2015 and 2019.
In 2020, its net loss stood at US$10.9 million, albeit narrowing from a net loss of US$29 million in 2019. Its adjusted Ebitda (earnings before interest, taxes, depreciation and amortisation) for 2020, however, worked out to US$3.4 billion in 2020.
At the same time, PropertyGuru is banking on its fintech and data segment as another engine of growth.
It launched its mortgage broking product in Singapore last year and pulled in over S$1 billion in loans over a 12-month period, according to a Forbes Asia report. Meanwhile, there are plans to beef up its fintech business with valuation & data consultancy services for the likes of valuers, banks and developers.
In the medium-term, its strategy includes branching out into adjacent services, such as home services (namely, contractor services and moving services) as well as operating systems (OS) for developers.
In 2020, revenue contributions from its data & fintech business segment were a small component of group revenue at just US$0.8 million, but is projected to multiply to US$28 million by 2025.
Execution, of course, will be key for PropertyGuru, but its partnership with Bridgetown 2 should arm it with the access to the necessary capital and expertise to help it along its journey.
Sep 28, 2021
AS PropertyGuru gears up to go public through a merger with a special purpose acquisition company (SPAC), its growth story will rest on leveraging opportunities in South-east Asia and its nascent - but expanding - fintech & data business segment.
In July, it was announced that PropertyGuru would trade on the New York Stock Exchange via a partnership with blank-cheque company Bridgetown 2 Holdings, backed by billionaire Peter Thiel and Hong Kong tycooon Richard Li, to create a combined entity with an enterprise value of around US$1.35 billion and an equity value of about US$1.78 billion. The deal is expected to close in Q4 2021 or Q1 2022, subject to the necessary approvals.
Singapore-based PropertyGuru - which counts TPG Capital, KKR and Australia's REA Group among its shareholders - will raise some US$431 million in gross proceeds, which will be channelled towards both organic and inorganic growth.
Of course, this isn't the first time the online real estate firm has sought to go public. An earlier attempt at a listing on the Australian bourse in 2019 was shelved over valuation concerns. It later went on to raise about S$300 million in September 2020 in funding rounds led by TPG and KKR.
Part of PropertyGuru's growth story is the opportunities that lie in its backyard. The South-east Asia region is poised to become the world's fourth largest economy by 2030, with increased Internet penetration and an emerging middle-class that will bolster the housing market.
While Singapore comprised nearly 57 per cent of revenue for its property agent & developer business in 2020, its other key fast-growing regional markets such as Malaysia and Thailand are expected to account for a greater proportion of revenue by 2025 than they do at present. In May this year, PropertyGuru announced it was acquiring REA's businesses in the two countries, including iProperty.com.my in Malaysia and thinkofliving.com in Thailand, to strengthen its capabilities as a proptech firm. In return, REA received an 18 per cent stake in the enlarged PropertyGuru.
Expanding footprint
Founded in Singapore in 2007, PropertyGuru has expanded its footprint to five South-east Asian markets, with over 49,000 active property agents, 37 million monthly property seekers and over 2.8 million monthly real estate listings. A large chunk of revenue comes from property agents/agencies who advertise on its marketplace, as well as digital sales and marketing solutions for property developers.
As the pandemic hit, group revenue tumbled from US$66.6 million in 2019 to US$61.9 million in 2020, but is projected to swell to US$222.6 million by 2025, according to an investor presentation released in July. Prior to the pandemic, revenue expanded at a compound annual growth rate (CAGR) of 25 per cent between 2015 and 2019.
In 2020, its net loss stood at US$10.9 million, albeit narrowing from a net loss of US$29 million in 2019. Its adjusted Ebitda (earnings before interest, taxes, depreciation and amortisation) for 2020, however, worked out to US$3.4 billion in 2020.
At the same time, PropertyGuru is banking on its fintech and data segment as another engine of growth.
It launched its mortgage broking product in Singapore last year and pulled in over S$1 billion in loans over a 12-month period, according to a Forbes Asia report. Meanwhile, there are plans to beef up its fintech business with valuation & data consultancy services for the likes of valuers, banks and developers.
In the medium-term, its strategy includes branching out into adjacent services, such as home services (namely, contractor services and moving services) as well as operating systems (OS) for developers.
In 2020, revenue contributions from its data & fintech business segment were a small component of group revenue at just US$0.8 million, but is projected to multiply to US$28 million by 2025.
Execution, of course, will be key for PropertyGuru, but its partnership with Bridgetown 2 should arm it with the access to the necessary capital and expertise to help it along its journey.