Facebook co-founder Saverin takes a shine to Singapore underdog06/06/2016
SINGAPORE (BLOOMBERG) – A decade after he got shunted aside at Facebook, Eduardo Saverin’s found another scrappy internet startup he’s proud to put his name behind.
The billionaire is reinventing himself as an Asian venture capitalist and thinks he’s found a winner in little-known 99.co, a Singaporean house-hunting service founded by local wunderkind Darius Cheung. So much so that Saverin, who’s flown under the radar since making the city-state his home in 2009, has gone to unusual lengths to grant the startup his imprimatur.
The Brazilian-born entrepreneur, who rarely graces media events, put in a public appearance in late May to plug 99.co to 300 property agents at its second-anniversary bash. There, he presided over a panel with local experts, drumming into his audience the need to embrace new technology – such as 99.co. Saverin even sat alongside Cheung for a casual interview – a rarity for a man who hardly grants any media face-time.
“He’s evolved a business that is highly qualified and really has two very admirable traits in the startup world,” Saverin said as Cheung looked on. “First is relentless focus. You have so much resources, you have a grand vision, you need to focus. Second is ruthless execution.”
The Facebook co-founder has drawn his fair share of headlines since The Social Network immortalized his disputes with Mark Zuckerberg, from accounts of night-clubbing, women in tow, to accusations he was dodging taxes by renouncing his US citizenship. But he mainly responds via intermediaries or statements. While local entrepreneurs including Cheung say he’s very hands-on as a mentor and board member, much of his work stays behind the scenes.
So the extent of his support for 99.co’s 35-year-old helmsman is unusual. Cheung became one of the island nation’s better-known entrepreneurs when he sold mobile security startup tenCube to McAfee in 2010, in one of the largest exits by a local entrepreneur at the time. He’s now trying to take on established competitors such as PropertyGuru with a Google-like approach to real-estate listings. That’s a tactic Cheung thinks will turn traditional industry models on their head.
99.co employs an ad-free Airbnb-like interface that ranks rental and sale listings not by fees, but by completeness and timeliness of info. Its model favors posts, for instance, with more photos, commuting times or even local dining options. On competing services, agents who pay more typically get better exposure. But 99.co only charges property listers when a house- hunter actually makes an inquiry, Cheung said. That in turn helps apartment-hunters by egging on agents to spruce up their listings.
Saverin didn’t get into the details of his relationship with the entrepreneur in the interview, but it’s clear the angel investor saw something in him. He first caught Saverin’s eye during a meeting in 2014 at 99.co’s office in Singapore’s “Block 71” startup hub. That same year, Saverin invested an undisclosed amount in 99.co, adding it to a list of investments in Asia that included Indonesian online bazaar Orami and rental service Silvercar.
“It was quite clear at that time this wasn’t just a project to create disruption and ROI,” meaning return on investment, Saverin said. “They were trying to make people’s lives better by curating the process through which people find their homes. The mission really drove me to the team and to Darius.”
The 800-pound gorilla in Southeast Asia remains PropertyGuru, which makes money by charging agent-fees and selling advertising and commanded about 90 per cent of the Singaporean market in April. 99.co has just 45 employees, 140,000 listings and says about 2,000 agents use the site exclusively. For context, PropertyGuru says it’s used by about 16 million property seekers and 33,000 advertisers a month.
Chief Executive Steve Melhuish said he wasn’t too concerned about 99.co.
“People have a preference for doing things one way or another,” he said. “But what we’re seeing is that nine out of 10 people are choosing PropertyGuru, and the remaining one is choosing one of three or four of our competitors.” Cheung hopes his “radically different” approach offers an alternative to rival services and will translate beyond his home country.
Armed with more than US$2 million from investors including 500 Startups, Sequoia Capital and Golden Gate Ventures, 99.co started a Jakarta website this year and plans to expand to a few more Indonesian cities before gunning for Kuala Lumpur and Bangkok. It launched 99PRO in late May, a package that agents subscribe to for S$388 ($286) a year to unlock features like interactive map searches, unlimited access to apartment floor plans and transaction data.
The startup’s name refers to Cheung’s desire to serve the 99 per cent. It was during the subprime crisis that he began delving deeper into the financial turmoil that consumed so many homeowners, and decided to start a real estate service that was transparent and intuitive.
“People were buying properties they didn’t understand,” Cheung said. “We don’t take money for ranking,” he argued. “What we can do is to use that as an incentive to make agents behave better.”
Original article from The Straits Times