MAXHEAP TECHNOLOGIES PVT LTD

Company Report: India-ecommerce-Unlisted

6 OCT 2014

www.indiabusinessreports.com

COMPANY BACKGROUND

Beginning
maxHeap Technologies was started in Apr2008 by 3
founders Sumit Jain, Lalit Mangal and Vikas Malpani.
The first 2 are the key promoters and also on the
board.
maxHeap focuses on e-commerce, and its key product
is a real estate listing website called
www.commonfloor.com. Very early in its life,
maxHeap managed to get marquee investor Accel
Partners to invest. The first round occurred in Aug09,
or just over a year after its inception. Since then, Accel
Partners and Tiger Global have invested a further 4
rounds.

Promoters
Sumit Jain and Lalit Mangal were classmates from IIT
Roorkee, where both majored in Computer Science.
Sumit drives the strategy and business at maxHeap,
while Lalit drives the product design and development
efforts at maxheap. The third founder, Vikas drives the
Communites Product at maxHeap. Prior to joining
maxHeap, Vikas worked at SAP Labs India. He holds a
Bachelors in Computer Science from VTU, Belgaum.
The common share capital of maxHeap is quite small
at 0.1mn. This is held as follows:

Shareholding Pattern
Name No of Shares* (%)
Lalit Mangal 24,515 44.6%
Sumit Jain 24,515 44.6%
Vikas Malpani 4,260 7.8%
Others 1,645 3.0%
Total
54,935
100.0%
*face value = Rs 2; as on Sep13

Company Basics
Registration No 046105
Registration Date 17.04.2008

Board of Directors
Name Designation
Lalit Mangal Whole time Director
Sumit Jain Whole time Director
Lee Jared Fixel Director
Gagan Kumar Director
Subrata Mitra Director



Address

#288,289, SGR Towers
7
th
Cross, Domlur Layout
Bangalore 560 071

Financial Summary

Year ending June 30
FY11 FY12 FY13
Net Sales (Rs mn) 6.3 7.7 48.2
EBITDA (Rs mn) -2.0 -24.3 -102.2
EBITDA Margin (%) -31.4 -316.1 -212.0
PAT (Rs mn) -2.0 -17.8 -97.6
Net worth (Rs mn) 6.0 129.4 31.8
Debt (Rs mn) 0.0 0.0 0.0

Sales Growth (%) 162.5 22.2 526.0
PAT Growth (%) -2.9 790.0 448.3
ROE (%) -18.8 -21.9 -64.3
ROCE (%) -20.0 -116.0 -126.7
D/E (x) 0.0 0.0 0.0






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Majority of the equity is preference shares of Rs 100
each, held by Tiger Global Six India II Holdings and
Accel India Venture II (Mauritius) Ltd.
The fully diluted equity for maxHeap could look like
this (assuming no ESOPs or other forms of subscription
by promoters)

Estimated Fully Diluted Shares
Shareholder Shares Held Stake
Lalit Mangal 24,515 9.1%
Sumit Jain 24,515 9.1%
Vikas Malpani 4,260 1.6%
Others 1,645 0.6%
Tiger Holdings 1,59,820 59.5%
Accel India Venture 53,800 20.0%
TOTAL 2,68,555 100.0%

Note this is an assumption by IBR, where we assume
that each preference share will convert into one
equity share and the excess of face value will be added
to the premium of the preference share.


BUSINESS HIGHLIGHTS

Property Listing Website: maxHeaps key product is
www.commonfloor.com, a market place for buyers
and sellers of property.
According to its site, Commonfloor aims to be a one-
stop solution for all apartment needs; from finding to
managing and connecting with the apartment
community.
CommonFloor.com claims to have more than one lakh
projects listed on their portal, more than any other
property portal in India. It also currently has over 4
lakh active listings.

Traffic stats: In a press release in Sep14,
Commonfloor claimed more than 2,00,000 users
visiting the portal every day. It also claims to have
witnessed a 100% increase in traffic, 125% jump in live
listings and added over 25,000 communities in the last
two quarters. The website also gets more than 25%
traffic on its site via mobile app.
Over 50% of the traffic to the website comes
from urban India, especially metros such as Mumbai,
Delhi, Bangalore and Chennai and close to 10%
from overseas.
Alexa Rank: As on Oct 6, 2014, Commonfloor was
ranked 4
th
amongst leading Indian property portals:

99acres.com 137
Magicbricks 148
Indiaproperty.com 154
Commonfloor 163
Housing.com 560
makaan.com 929
Indiahomes.com 4192

People and offices: The company has a team of 900+
employees. CommonFloor has also expanded its
geographic footprint with new offices in 11 cities
Jaipur, Chandigarh, Lucknow, Nagpur, Indore,
Ahmedabad, Kochi, Coimbatore, Mysore, Kolkata,
Mangalore. The company already had offices in
Bangalore, Mumbai, Noida, Gurgaon, Chennai,
Hyderabad and Pune.

Acquisition: Earlier in the year, in Apr14,
Commonfloor acquired Flat.to, a site that helps
students and singles find accommodation.

FINANCIAL HIGHLIGHTS

Revenues seemed to pick up slowly at Commonfloor in
the early years. FY10 revenue was Rs 24 lakh (Rs
2.4m). For the next 2 years, the growth was slow,
revenue reaching Rs 7.7m in FY12. It was in FY13 that
there was some momentum, revenues jumped over 6x
to Rs 48m.
Profitability is sharply negative, with costs running 2-
3x more than revenue in FY12 and FY13.
It is possible revenues may have continued to shoot
up in FY14. The company is aiming for revenue of Rs
1500m in FY16, for which it will need continued
explosive topline growth.



India-Ecommerce-Unlisted maxHeap Technologies Pvt Ltd
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FUNDING AND FUTURE PLANS

Since its inception, Commonfloor (used
interchangeably with actual corporate name
maxHeap) has raised 5 rounds (till Series E). Accel
Partners, the storied Silicon Valley fund, was the first
investor and funded Series A. Tiger Global stepped in
in the Series B. Both funds have since then pumped in
multiple rounds.

This is how the fund raising looks like:

Date Round Who Amount
(Rs m)
Valuation
(Rs m)
13.08.2009 A Accel 12 72
18.07.2011 A1 Accel 5 249
06.09.2011 B
Tiger,
Accel 136 490
03.04.2013 C Accel 27 1213
11.11.2013 D
Tiger,
Accel 640 3593
05.08.2014 E Tiger 1800 9609

As can be seen, the company has raised over Rs 2.6b
(~USD 45m). The pace of fund raising has picked up
since FY14. In the last 18 months, the company has
raised 3 rounds aggregating Rs 2.48b, or most of its
funding.
The valuation has also shot up dramatically, reaching
almost Rs 10b by the last round in Aug14.


Growth Plans: A press release post the latest round of
funding stated that: This round of funding will be
used to invest further in our product and technology
that will enhance customer experience. The company
will continue to strategically scale-up its marketing
and operations across the 18 cities where its currently
present and expand to 22 new markets in India.
According to an article in The Economic Times,
Commonfloor was aiming for revenue of Rs 150 crore
by FY16. That would be 31x its FY13 revenue.

India-Ecommerce-Unlisted maxHeap Technologies Pvt Ltd
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FINANCIAL DETAILS

P&L
(Rs mn) FY10 FY11 FY12 FY13
Net Sales
2.4 6.3 7.7 48.2
EBITDA
-2.0 -2.0 -24.3 -102.2
Margin (%)
-83.3 -31.4 -316.1 -212.0
Interest
0.0 0.0 0.0 0.0
Other Income
0.0 0.0 7.0 6.3
PBDT
-2.0 -2.0 -17.3 -95.9
Depreciation
0.0 0.0 0.4 1.4
Extraordinary Item

0.0 0.0
PBT
-2.0 -2.0 -17.7 -97.3
PAT
-2.1 -2.0 -17.8 -97.6
PAT Margin (%) -85.8 -31.7 -231.2 -202.5

Balance Sheet
(Rs mn)
FY09 FY10 FY11 FY12 FY13
Liabilities

Equity Capital
0.1 10.4 10.4 17.4 17.4
Reserves
0.2 0.2 0.2 134.3 134.3
Shareholder Funds
0.4 10.6 10.6 151.8 151.8
Debt
0.4 0.1 0.0 0.0 0.0
Deferred tax liability
0.0 0.0 0.0 0.1 0.4
Other Long Term Lialilites
0.0 0.0 0.0 0.0 0.0
Total Liabilities
0.8 10.8 10.6 151.8 152.2


Assets

Fixed Assets (net)
0.6 2.3 3.8 7.7 16.1
Other Long Term Assets
0.0 0.0 0.0 7.9 7.9

Inventories
0.0 0.0 0.0 0.0 0.0
Debtors
0.0 0.8 1.8 1.2 3.2
Cash
0.1 0.0 1.4 118.4 22.1
Loans & Advances
0.0 0.6 0.5 0.0 0.5
Other CA
0.0 0.0 0.0 0.0 0.1


CL & Provisions
0.5 0.8 1.5 5.9 17.7
Net Current Assets
-0.4 0.6 2.2 113.7 8.2
Misc Expenses
0.5 2.6 4.6 22.4 120.0
Total Assets
0.7 5.4 10.6 151.8 152.2

India-Ecommerce-Unlisted maxHeap Technologies Pvt Ltd
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Ratios

FY11 FY12 FY13
Growth (%)

Sales 162.5 22.2 526.0
PBDIT -1.0 1129.3 319.8
PBT 0.0 785.0 449.7
PAT -2.9 790.0 448.3

Margins (%)

PBDIT -31.4 -316.1 -212.0
PAT -31.7 -231.2 -202.5

Balance Sheet Ratios

ROE (%) -18.8 -21.9 -64.3
ROCE (%) -20.0 -116.0 -126.7
D/E (x) 0.0 0.0 0.0
Inventory t/o (days) 0.0 0.0 0.0
Debtors t/o (days) 75.5 70.8 16.7
Payables t/o (days) 51.1 59.5 18.0
Cash Conversion Cycle (days) 24.4 11.4 -1.4


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