Key Highlights

• Total Revenue grew by 41%, to ₹109.1cr (in FY24) from ₹77.2cr (in FY23)
• Recorded zero cash burn in the final three months of the financial year
• Completed an ESOP buyback for eligible Mygate team members
• Revenue projected to grow by 75% YoY in FY25

A Quick Recap of FY24

With a clear belief in the mantra of ‘responsible growth’, we spent most of FY24 keeping a close eye on growing overall revenue while successfully managing expenses.

On both counts, the progress has been significant. Total Revenue has grown 41%, to ₹109.1cr (in FY24) from ₹77.2cr (in FY23). Simultaneously, cash burn has reduced by 85% with zero cash burn in the last quarter (January to March) of the financial year FY24.

Growth in revenue is backed by good progress in our key revenue streams of Advertising and Software as a Service (SaaS) subscriptions. Interest from brands in our Brand Connect Platform is stronger than ever before. From pharma to eCommerce, OTT to auto, fashion to BFSI, and beyond, the leaders of every category are working with us. With many of them – a large eCommerce player, one of the largest QSR brands, to name a few – we have struck deep and unique partnerships to drive growth for them in key locations country-wide.

Better business conditions meant that we could afford to do something that every start-up wants to do: give back to those that help it succeed. In February 2024, we announced and completed an ESOP buyback for eligible team members.

At the very end of the financial year, we also announced a new positioning as a living experience tech company with an aspiration to introduce products and services for the evolving needs of community and home and make everyday the living experience better.

Our Eight Year Journey: From Product-Market Fit to Revenue Focus

Establishing product-market fit (2017-2019)

In January 2017, 25 societies adopted the Mygate solution; they were the first to adopt our novel idea. We played the role of security guards, had constant meetings with Resident Association Members members, and regularly talked to residents, too. The hard work paid off.

We thoroughly understood the customer problem; our product created a delight for residents as they could have real time insight and control on what is happening about their home at the gate of the society. Approving visitors from anywhere and knowing when their househelp entered the community created a joy. We created the perfect blend of security and convenience. From here we cautiously began expanding across Bengaluru, and soon took Mygate to other metros like Mumbai, Pune, Hyderabad and NCR. By the end of 2019, we were cruising toward 5,000 communities using a solution that included not just gate/security modules but also a full fledged community management platform that enabled resident welfare associations to run the day to day affairs of society. Our full suite of solutions can be referenced here: https://mygate.com/offerings/ .

Shifting gears (2020- 2021)

As soon as the pandemic hit, we began rolling out a slew of features designed to help our communities safely navigate the situation. Temperature checks at gate, Vaccination status updates and many others were introduced as Covid Features on the app. We also worked with numerous partners to safely bring to our residents groceries, medicines and even the newspaper at a time when things were scarce.

The response was phenomenal. Our product metrics were more positive than ever and strong word-of-mouth brought new communities our way at a frenetic speed. Nashik, Zirakpur, Bhilai, Dehradun. Communities everywhere began reaching out.

Over the next 2 years, we grew to 20,000 societies. Hockey-stick growth.

Such upward curves do come at a significant cost. Having achieved our quest for scale, it was time to plug our burn and begin our revenue generation journey to ensure we grew responsibly.

Focus on Revenue Generation begins (2022 onwards)

We have the opportunity to build several new businesses. You see these today in the form of products and services such as Mygate Home Services and the Mygate Brand Connect Platform. The former quickly gained traction, prompting two of India’s most successful start-ups to come onboard as strategic partners.

The success of the Mygate Brand Connect Platform is perhaps more interesting.

The Arrival of a Brand Partner: With large, premium consumers using our app for their daily community living, we always received interest from brands looking to leverage our app to communicate their messages. Both on the app (via digital space) and within the community (via events, kiosks, gate signages, etc).We put this to the test and it took off almost immediately. We saw large brands come on board.

As of June 2024, the Mygate Brand Connect Platform has become a fixture in the marketing mix of several large consumer brands and has been the largest contributor of revenue. While advertising as a business vertical is driving revenue, we are also conscious of its impact on the user experience. We have, therefore, introduced premium plans that offer an ad-free experience at both the society level and user levels.

Data privacy of our user base continues to be a key foundational value no matter what business we do. We had made ourselves GDPR (Global Data Protection Regulation) ready back in 2019. We are compliant with The India Digital Personal Data Protection Act 2023 (DPDPA). We have been certified with ISO 27001:2022, the international standard for information security management. In short, we protect our client’s data as if our life depends on it.

Current Financial Status: Responsible Growth

Key Business Metrics

The financial performance of the company has shown significant improvement over the years, reflecting strong growth and positive trends.

Significant revenue growth since FY21

The company’s operating revenue increased by 11.4 times, to ₹96.2cr in FY24 from ₹8.4cr in FY21, indicating a substantial expansion in its business operations. This growth can be attributed to both enterprise and consumer revenue streams. Revenue from enterprise sources, such as Resident Welfare Associations, FM Companies, Security Agencies, Builders, and other Brands, witnessed a remarkable increase. Additionally, revenue from consumer services, including utility bill payments, maintenance bills, and home services, also experienced decent growth.

Decrease in expenses since FY21

Despite the significant increase in revenue, the company has effectively managed its expenses. Between FY21 and FY24, expenses have been nearly flat, showcasing the company’s commitment to growing efficiently. This demonstrates the company’s ability to generate revenue growth while maintaining a disciplined approach towards expense management.

The company has, therefore, successfully reduced its losses, as indicated by the adjusted EBITDA figures. Between FY21 and FY24, the company’s losses decreased by 81%. This improvement highlights the company’s focus on profitability and its ability to optimize its operations. The reduction in losses signifies a positive trajectory towards sustainable financial performance.

Cash burn at near-zero in FY24

The company has demonstrated a significant dip in cashburn in FY24, with zero burn in Q4. This showcases the company’s effective cash flow management and its ability to control expenses while generating sufficient cash inflow.

Overall, the company’s financial performance reflects a positive growth trajectory. With significant revenue growth, efficient expense management, reduction in losses, and effective cash flow management, the company is well-positioned for continued success in the future.

Most Innovative, Most Used, Most Loved, Most Comprehensive

Most Innovative

We are known for driving innovation in this space. From e-Intercom to the community engagement platform, we have innovated in every aspect of the product. Our latest innovation has been Validated Entries, a A silent & secure delivery approval workflow (currently enabled for deliveries from Swiggy, Zomato, Blinkit, Zepto, Lenskart & Urban Company) to strengthen the security protocol of societies and minimise wait times for the delivery partner and our users.

Most used

With over 5 million homes we are the largest community management app in the country.

Most loved

Mygate is the highest rated Community App with a rating of 4.7 by 80,000 people rating us in Apple Store and a rating of 4.4 by 51,000 people rating us in Playstore.

Most comprehensive community app with the largest scale

Mygate is established as the most comprehensive Community App from visitor/security management to Community ERP. Here is the view of the Mygate scale in FY24:

• Validated over 1.4 billion visitor entries
• Enabled maintenance invoices worth ₹5800 crore
• Facilitated the management of 6 million society helpdesk tickets
• Generate 11 million invoices to enable revenue collection for societies

In Conclusion: Where to from here

The exciting parts of the previous two years have been what in the startup world is thought to be boring: Optimizing expenses, lowering costs, responsibly growing revenue. As we mature as an organisation, we look forward to more of the same.

Yet, we are a startup at heart, and when any opportunity arises, we will look for areas where we can innovatively make a difference. Over the past few months, we have begun to pilot a large new initiative that will expand the foundations of the company, and take the magic of Mygate beyond gated communities, too. Expect a lot more news coming on this front as early as next month.

Until next time.

Regards,
Team Mygate
June 2024