Housing.com names Jason Kothari CEO, to cut more jobs
Real estate portal Housing.com has appointed Jason Kothari as its chief executive officer. Kothari, who joined the startup as chief business officer in August, has been "unanimously appointed by the board of directors," said a statement from Housing. Housing's board is led by Jonathan Bullock, representative of lead investor SoftBank.
Housing has been operating without a CEO and under the dual leadership of interim CEO Rishabh Gupta and Kothari for the past three months. Gupta and Kothari were part of the operating committee at Housing which was driving the firm after the controversial exit of its co-founder and CEO Rahul Yadav in July.
The company has not specified the new role of Gupta who was previously its chief operating officer. He was also seen as a contender for the post of CEO. According to people familiar with the development, Gupta would take a break and could eventually leave the company. He was not immediately available for a comment.
Early this year, Housing had mandated executive search agency SpencerStuart to find CEO candidates for the startup. However, it put aside the CEO search a couple of months ago and decided to stabilise the company which went through a series of controversies and unbridled cash burn under its former chief Yadav.
Housing has trimmed its workforce, shut operations and brought in new senior executives including chief financial officer Mani Rangarajan, chief marketing officer Nikhil Rungta and general counsel Nandini Mehta in the past three months.
"Jason has played an instrumental role on a number of key initiatives, including establishing a strong senior management team for the company, strategic partnerships and new products," said the statement.
"I am honoured that the board has entrusted me with the responsibility of leading this dynamic company," Kothari said in the statement.
Prior to joining Housing, Kothari was co-founder and CEO of Valiant Entertainment, where he led the acquisition and turnaround of former $65 million unit of video game company Acclaim Entertainment. The company raised over $300 million from strategic investors including Chinese media conglomerate DMG Entertainment, according to a career profile sent by Housing.
He holds a Bachelor of Science from University of Pennsylvania's The Wharton School where he has served as a guest lecturer on entrepreneurship and venture capital.
Kothari has taken over as CEO amid a fresh round of layoff at the three year-old startup founded by a dozen IIT Bombay alumni.
The company last week decided to lay off an additional 175-230 staff across its operations within a month after cutting about 600 jobs in August-September.
Top Housing executives, who do not want to be identified, said it has relieved only around 150 employees who were on its payroll and the rest were data collectors who were on contract. "The board had set a target to bring down cash burn. The recent actions were not enough to bring it down to that level. Therefore, further pruning is required," a person with direct knowledge of the development said.
The three-year-old startup has a workforce of around 1,900 of which 1,500 are on its payroll. The Economic Times, which first reported the development, quoted an unnamed Housing executive, saying that the company gave targets to department heads to identify core strengths.
The unbridled expansion of business divisions across cities under former chief Yadav left the company with cash reserve for hardly five-six months at the time of his exit, forcing its operating committee to initiate drastic downsizing of operations and workforce. According to industry players, Housing has shut down a dozen business divisions and operations in 25 cities.
"SoftBank has committed to put in additional money but mandated the startup to streamline its operations and fulfil certain targets," said the person cited above. Housing is soon to raise around $30 million from SoftBank, as reported by VCCircle a month ago.
The startup raised around $120 million so far, mostly from the Japanese telecom and internet conglomerate SoftBank which put in around $70 million in exchange of a 32.5 per cent stake, valuing the company at $215 million in December 2014.