It’s that time of the year, when if you are a startup called Quikr, you almost wish that Putin stops pretending and actually invades a country or two, if that helps take the focus off its results for the fiscal year gone by (FY21).
Quikr used to be one of the early, and more well-capitalised unicorns in India as it raised over Rs 3,000 crore across a dozen financing rounds. But the business model to justify those promises made to its investors remains elusive.
Quikr FY21 is consistent in that regard at least. While it has managed to cut down losses by about 90%, its topline shrank 45% in FY21.
The 14-year-old company generates revenue from four different categories: advertising, referral, commission and RTO & consulting. Combined, these incomes slipped 45% to Rs 60.75 crore in FY21 from Rs 110.41 crore in the preceding fiscal year, regulatory filings show.
Advertising and referral fees were the major source of revenue, which constituted 42.88% and 44.82% respectively. Advertising income was down 40.31% to Rs 26.05 crore in FY21 from Rs 43.64 crore in FY20. Income from referral fees also came down 33.62% to Rs 27.23 crore in FY21.
Collections from commission, RTO and other consulting services also decreased 72.67% and 68.58% respectively to Rs 4.14 crore and Rs 3.33 crore in FY21 from Rs 15.15 crore and Rs 10.6 crore in FY20.
Quikr has managed to cut its expenditure by 76% to Rs 123.9 crore in FY21 from Rs 514.68 crore in FY20.
Employee benefits expenses were the biggest cost centre for the company in FY21 and form 49% of the total expenses which shrank 59% to Rs 60.78 crore from Rs 149.84 crore in the previous fiscal year (FY20).
The finance cost of Quikr decreased 41% to Rs 12.91 crore in FY21 from Rs 21.83 crore in FY20. Information Technology which includes (web hosting charges and payment gateway fees) also came down 27.66% to Rs 5.78 crore in FY21. Last year, Quikr indulged in internal restructuring, resulting in an increase of professional and legal fees by 22.48% to Rs 8.5 crore in FY21 from Rs 6.94 crore in FY20.
The Bengaluru-based company has controlled the cost of advertisement and rent & repairs which shrunk by 83.42% and 45.19% respectively to Rs 4.05 crore and Rs 6.95 crore in FY21.
In 2020, the holding company closed off certain business verticals including At homes diva, Car & Bikes, Home services, Home rental solutions and Quikr Jobs Flexi. As per the financial statements, losses from the discontinued operations recorded Rs 181.87 crore during FY20.
Due to control in expenses, Quikr’s losses shrank 90% to Rs 55.48 crore in FY21 from Rs 563.2 crore in FY20. Control in losses also affected the cash outflows of the company which stood at Rs 80 crore in FY21 from Rs 142.2 crore in FY20. On a unit level, Quikr has spent Rs 2.04 to make a rupee in operating revenue.
Quikr has been a poster case for everything that can go wrong despite generous funding, be it business model, people, or management. It’s a good thing that it survives to this day with so little to show for the thousands of crores it has burned through, demonstrating how stark the difference between strategy and execution on the ground can prove to be. For its founder and CEO Pranay Chulet, an IIT+IIM background along with consulting gigs at top firms did more than any other founder could have hoped for. It really is a wonder that the firm continues to live to advertise its failures.