99.co sees 62% surge in 2020 revenue amid Covid-19 setbacks

Finding a new home, whether to own or to rent, can be a daunting and time-consuming process. At a time when visiting a physical site is a real challenge, Singapore-based real estate portal 99.co raised its revenue by 62% in 2020.

The 99.co team/ Photo : credit: 99.co

The proptech company recorded US$5.5 million in revenue last year, up from US$3.4 million 2019, and is currently operating at an annualized revenue run rate of about US$10 million, a source with knowledge of the matter told Tech in Asia under the condition of anonymity.

The revenue growth can be attributed to subscriptions, packages like must-see listings, and partnerships with media and developers. Net cash flow jumped by 77%, thanks to “prudent and strategic spending,” 99.co said in a statement.

The company posted strong growth numbers on the back of cost-cutting measures and its efforts to improve fundamentals. This has resulted in savings of about US$100,000 for the firm, said Darius Chueng, 99.co’s CEO and co-founder, in an interview with Tech in Asia.

99.co’s EBIT (earnings before interest and taxes) margin improved by half in 2020, according to the source. Its contribution margin has also moved into the green, which means that the company makes 50 cents for every dollar, the person added.

While the anonymous source didn’t disclose if 99.co posted an operating profit in 2020, it had reported operating losses in previous years.

The company posted a loss before interest and tax worth US$5.9 million in 2019, marking a 19% increase from a year ago. In 2018, its operating losses had widened by 38% to US$4.9 million.

In the past, 99.co saw huge surges in revenue. It had doubled its revenue in 2019 to US$3.4 million from US$1.7 million in 2018. In 2017, revenue shot up 3x, according to VentureCap Insights data.

99.co declined to respond to Tech in Asia’s questions about its earnings.

Rising up to Covid-19

The company took several cost-cutting measures and altered its business model in response to the hurdles brought on by the pandemic.

The staff took voluntary pay cuts and opted for a pay-swap version of 99.co’s employee stock ownership plan, where a dollar of their pay was exchanged for US$2 worth of stock, Cheung said. He added that his remuneration was also reduced to zero for about nine months.

Besides this, 99.co also decided to work on its user experience to drive growth. The company invested in code refactoring, a process of restructuring the computer code to improve the software, which used a chunk of its server space. The server costs were optimized and slashed by 30% to generate an up time of 99.97%, which means that a user is redirected to 99.co’s website at a faster rate than before.

Taking on PropertyGuru

Going forward