Fractional Ownership Startup hBits Raises INR 20 Cr

Mumbai-based proptech startup, hBits, has raised INR 20 Cr ($2.6 Mn) in a strategic funding round that saw participation from a clutch of institutional and angel investors.

The participants included IIFL chairman Nirmal Jain, Incred Capital, Jungle Ventures’ former executive Jayesh Parekh and senior Nomura Services executive Awdhesh Krishna.

The fractional ownership platform will use the funding to expand footprint, scale up customer acquisition and ramp up acquisition of new assets. The startup will also deploy the investment to shore up its technology stack to focus more on user-experience and security of transactions on the platform.

Founded in 2019 by Shiv Parekh, hBits focuses primarily on the fractional ownership market and allows users to invest in Grade A pre-Leased property. The fractional ownership model allows users to pool their money and invest in assets without high risk exposure and without a huge financial undertaking. 

“The concept of fractional ownership is the next big thing in commercial real estate in India…We take care of several critical aspects of investing right from discovery until the liquidation of properties. hBits helps investors with all preliminary processes such as due diligence, procurement of the title document of the asset, and overall asset and peer group comparison; fractional ownership platforms attract investors interested in building future income,” said hBits CFO Samir Bhandari.

Meanwhile, the startup currently has eight assets worth INR 150 Cr under its management. The startup manages nearly 1.50 Lakh square feet of area across Mumbai in areas such as Andheri and Bhandup. It counts marquee names such as IIFL, ATPI and ICICI Bank as tenants at these properties. 

hBits aims to list 40 new Grade A properties and attract investments of INR 1,000 Cr within the current year. 

Elaborating their future plans, the startup said that it will expand and establish its presence in the country’s ‘top six cities’ by the end of next year. hBits claims to have 30,000 investors on its platform, adding that majority of them working in multinational companies at managerial level positions. 

hBits CEO Parekh continues to be bullish about the startup’s addressable market and the overall fractional ownership space. 

“Fractional ownership is gaining momentum with new players joining the band. The market is becoming competitive and exciting for everyone. Investors are taking up opportunities in a day for Grade A assets…We believe that investors in Fractional Ownership in Grade A assets will outnumber the number of properties available for investments,” added Parekh. 

hBits also plans to deploy blockchain technology to ease the process of executing transactions and embed further transparency in transactions. 

The Burgeoning Space

hBits operates at the intersection of proptech and fintech. While fintech has always been the eye candy of the Indian startup ecosystem, the proptech space also picked up pace this year.

Realising the growing demand for capital investment, recently, the Confederation of Real Estate Developers’ Associations of India (Credai) teamed up with incubator Venture Catalysts to set up a $100 Mn fund to invest in proptech startups.

This came close on the heels of proptech accelerator Gruhas ASPIRE announcing last month that it has selected seven startups as part of its maiden cohort.

Despite an overall gloom that appears to have engulfed the overall startup ecosystem, the homegrown proptech space continues to raise a steady amount of funding. Earlier this month, Housing.com founder Rahul Yadav’s new proptech venture Broker Network raised around INR 90 Cr in funding from Info Edge. 

Prior to that in August, Bengaluru-based Landeed raised INR 19.5 Cr in a pre-seed funding round led by CRED’s Kunal Shah, Clutterbot’s Justin Hamilton, among others. Before that in July, Homexchange raised $4 Mn in funding from HDFC Capital, Oberoi Realty and Anarock. 

According to a report, the Indian proptech space is expected to attract investments to the ture of $1 Bn by 2025.