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Troubles for real-estate start-up Housing.com do not seem to come to an end. Having been embroiled in controversy for the past one month, after then Chief Executive Officer (CEO) Rahul Yadav’s particularly bitter and unprofessional e-mail to Sequoia Capital India Managing Director Shailendra Singh became public on question and answer website, Quora, it is in news again, this time for a much publicised resignation.
Rahul Yadav has quit the company as CEO. He questioned the intellectual capability of the board of members in his resignation letter and gave them a weeks time to complete the transition process. The somewhat brash tone of the resignation letter shouldn’t come as a surprise, given that Yadav has earned a reputation for writing such mails.
Gaining prominence in the Indian start-up ecosystem with an investment of $90 million from the Japanese major, SoftBank Group, Housing also caught eyeballs with their revamp process around March this year. What followed was extensive and aggressive advertising across all platforms -- physical, social media, radio, television.
Read more from our special coverage on "HOUSING.COM"
Things started going downhill when Yadav accused Singh of poaching Housing.com employees and “brainwashing them to open some stupid incubation”. Troubles between investors and start-ups are not unheard of. Differences between two parties who have their own interests to take care of are only natural. But this was the first time that these became public. A war of words on Twitter ensued, with many prominent names in the start-up space taking sides. Flipkart’s Sachin Bansal had tweeted, “Sequoia isn't an investor with us. I would just say I'm glad to have it that way.” Avlesh Singh, co-founder and chief executive of WebEngage, had said, “Buy billboards, buy print ads...got more money? Badmouth someone and hire a public relations agency to ‘get the word’ out.”
Buzz around this incident had not died yet and Housing found itself facing a defamation lawsuit filed by the Times Group. The notice was the result of another e-mail that Yadav had sent to the company’s employees, stating the Group was trying malign Housing and “group owned MagicBricks, a real-estate website and a competitor to Housing.com, is raising funds in the US”. It is significant to note that MagicBricks is owned by the Times Group. The e-mail was a result of a report carried by the Economic Times that stated the investors were looking for a new CEO for Housing.
What is interesting is that this brings to light the fissures in the heretofore rosy start-up sphere. We’ve only read about how the Indian economy is the best breeding ground for start-ups right now. The words funding, venture capitalist, angel investors have become a staple part of the everyday news. But it is only with the Housing stories that the happy bubble has been burst. Here we are seeing a tussle between the young founders and the “big” investors. It puts forward an important question of who is bigger-- the person with the idea or the person with the money. To say whether Yadav is wrong or being wronged is difficult. But to say that everyone will be following the developments closely would be right.
