Darius Cheung was trained in engineering, but he had a strong interest in entrepreneurship since young.
“The initial boom of the internet happened when I was around 17 or 18 years old. I still remember my first Rocket mail account, Yahoo Search, Excite Search, IRC/ICQ et cetera. At that point in time, it was life-changing as it allowed us to be able to connect to people around us and across the world, and find information on things,” said Darius.
He did not have any computer back then, and had to often rely on computer labs whenever he wanted to go online.
His interest in entrepreneurship sparked when he first learnt about Silicon Valley, which has become a world-renowned tech hub. However, besides the fact that many innovations were born there, he knew next to nothing about it.
He became fascinated with technology and the impact it could make, which was why he chose to major in engineering in the National University of Singapore (NUS). He ended up taking part in anything relating to tech entrepreneurship, including applying for NUS Overseas Colleges programme.
After graduation, it was a natural step for Darius to start up his own company. Although he’s best known as the co-founder of 99.co and 99 Group now, his first venture was nowhere close to proptech.
He sold his first company to McAfee for US$25M
In 2005, he co-founded mobile security firm tenCube alongside fellow NUS alumni, Varun Chatterji and Rishi Israni, who are also trained in engineering.
Arun and Rishi were both computer scientists, while Darius took on the role of a computer engineer. While they weren’t experts, they had the skillsets and knew how to write codes.
The idea of tenCube started when his co-founder Varun lost his brand new Nokia phone, which was a popular and expensive model at the time.
He did not just lose his phone, but he also lost the photos and contacts that were stored in it, which made him very upset. They are aware that losing phone is a common occurrence, and with phones growing to be a more powerful device, this became a growing concern.
“That was why we built a suite of features, and called it WaveSecure. This product will help you backup your phone, remotely wipe your phone to protect your privacy, remotely track your phone in case you lost it, which [has become] a standard feature on iOS and Android devices today. But back then, Nokia, BlackBerry and Window mobile devices did not have this, so it became clear to us that this was a feature that was absolutely needed,” explained Darius.
They built on the product and realised that it helps to solve data security issues, especially since people started getting corporate emails on their phones.
“Our end goal was to be an enabler — to enable people to do more with their phones,” he added.
Five years after we started tenCube, it became clear that the PC guys like McAfee and Norton were much far behind in their mobile development. By the time they realised it, we were one of the top three companies in the world for mobile security, and it became clear that it was an acquisition path for them.
– Darius Cheung
The co-founders eventually sold their company to McAfee for US$25 million, and they were all under 30 then. Darius in particular, was only 28 at the time.
He described himself as “very young and naive” then, but he is confident that they made the right decision to get a “bigger umbrella” to scale their existing product.
He shared that they received partnership proposals from major telcos in Europe, which had hundreds and millions of users, and billions of dollars in revenue.
“Based on their proposal request, we were pretty much the only company who could fulfil it. However, they could not accept us as a vendor because we did not have the financial strength. We did not have enough money in the bank to do this for them.”
The co-founders didn’t see this as a problem because they knew that they have a product that works. However, from the telco’s perspective, if something goes wrong, tenCube won’t have the money for them to sue.
That was when they realised that they “needed a bigger machine to work on a global scale”, which became the impetus for them to sell the company to a bigger player like McAfee.
A new venture: From mobile security to mobile wallet
After the acquisition, Darius stayed on in the company for another two years before he started angel investing.
In between, he started up yet another venture, BillPin, which was inspired by how WeChat users were able to easily transfer money via the messaging app.
“At that point in time, we started building because we saw that [many] housemates share bills. It was a hassle to figure out who owes what, so we [wanted to find] a much simpler way to help people share their bills,” said Darius.
“With BillPin, you could hold a balance and nett off expenses, so you don’t have to bother with cash transfers. It actually had a tremendous amount of traction, and we had a lot of users very quickly. However, one of the thing about BillPin is that it’s inherently viral — for you to use it, you would need to bring in your housemates or friends for it to work.”
While it grew quickly, Darius and the rest of the co-founders decided not to pursue it because it had strayed from the original intent of making BillPin a mobile payment method. Furthermore, there is already some version of this in most countries.
We realised that the path of BillPin did not lead to a mobile wallet for two reasons. One was that the frequency of people using this was just not high enough. You need a high frequency usage for a mobile wallet to work. Today, that equivalent is seen in use cases like ride-hailing, transport or food delivery.
These high frequency use cases also require transaction payments. We did not see something too meaningful and worth pursuing, as it was not aligned with our purpose and our need to do something to make a dent in the world, so we decided to move on from there.
– Darius Cheung
He invested in Carousell, Glints, Rocket Academy
After tenCube, Darius “accidentally” became an angel investor. In his personal network of family and friends, he often supported them in their entrepreneurial endeavours.
He sees himself as a “founder-friendly” investor, in the sense that some of the advice that he gives end up hurting him as an investor, which is he fine with, since he was never in it for big returns.
He added that he finds it fortunate that he found himself a very good investor, specifically Professor Wong Poh Kam, who used to be a professor in entrepreneurship in NUS. Professor Wong was always there whenever he needed help and support, and he wants to pay it forward and become an angel investor for other startup founders.
So far, he has invested in about 15 to 20 startups, including Carousell, Glints and Rocket Academy, among the homegrown ones.
He shared that he used to share the same co-working space as Carousell founders at Blk 71, and it was clear to him how hardworking they were, and the trio were often the last to leave the office.
Darius has a soft spot for this sort of hardworking attitude in startup founders. In fact, when he visited seed-stage startup incubator AngelPad in the United States just before Demo Day, he saw three companies that were still working past midnight on a Friday.
“I invested in all three [and] that actually worked out well — two of them ended up being acquired, and I got a positive exit on those two,” said Darius.
99.co started out as a rental-focused platform
Darius first met his fellow 99.co founders — Yan Phun and Chong Ming Hwee — back in school. Ming was his roommate back in NOC, while Yan was their junior.
Yan was starting another company of his own at the time, and since the NUS startup scene is a small community, that was how they got acquainted with each other.
According to Darius, 99.co actually started out as a group project. It was initially a site called Homey, which helped renters find roommates to share an apartment with. This idea later evolved into 99.co when he realised how “broken” the property industry was, which they personally witnessed when they were looking for homes back then.
“From [the] online search experience, to meeting agents who were ill-equipped with data and tools to help their clients, we realised there was so much that could be done to reinvent the space,” he added.
The fact that they were renters themselves, gave them insights and “early access”. They started conducting market research to gain a comprehensive understanding, and looked overseas — particularly in the US and China — for inspiration on the kind of tech and innovation that was available.
Founded in 2014, 99.co is now Singapore’s fastest-growing property portal. At the start however, the platform was laser-focused on apartment rentals.
We gained a lot of traction early on. We were actually effective, and got a lot of agents putting listings with us. That made it easy for us to get funding at an early stage.
[However], getting funding easily brought [about] its own set of challenges, as it was too easy for the team to grow and use capital as a shortcut. Instead of doing some of the hard work in solving deeper problems or building slowly, we realised we did not have the luxury of time because with capital, comes the expectation of speed of growth.
– Darius Cheung
The money came too easy at the start, and they needed more time because with money, comes the expectation of velocity, which created a mismatch for them in terms of pace.
In contrast, today’s fundraising landscape is very different. The capital market can be volatile — it’s tough right now, though it was “really hot” just nine months ago.
“Markets go up and down, and the challenge that comes with it changes along the way. The challenge for me is balancing my role as the person heading out to fundraise versus spending time on internal product development, team culture building, leadership building and recruitment,” said Darius.
“By and large, we are operators in nature, so we spend more time in building our company than fundraising. But I think there is a balance somewhere, and the challenge is in trying to find the best time to do each of them.”
How 99.co evolved over time
As 99.co pivoted into larger segments and solving deeper problems, especially in property purchases, it became more challenging as buying a property is a very different journey compared to someone looking to rent an apartment.
Darius explained that a buyer and renter adopt different mindsets when it comes to getting a property. A buyer sees it as a big-ticket purchase and tend not to rush through the process, while a renter simply wants to look for somewhere decent for a temporary stay.
In addition, renters are willing to fork out a few hundred dollars extra in light of other trade-offs like good location, while buyers are highly concerned over pricing.
Bearing this in mind, 99.co had to integrate new features into its product, such as transaction data, to cater to property buyers. Such data helps consumers make better decisions on what price to pay for their property.
Another feature that it introduced was map search, which helped people find where they should live. “It sounds obvious, but up till then, there was no one in Southeast Asia providing it,” said Darius.
“We eventually got a lot of traction, but it took time for us to discover and develop these products. And because we were well-funded, there was that forced speed that we had to get traction faster than we were ready to. So one of the struggles was also in managing the speed and development cycle.”
Initially, 99.co’s business model mainly revolved around serving agents, but it has since expanded to include developers and media, providing a 360-degree solution for all three streams.
In the early days, Darius confessed that they didn’t put in much effort to raise brand awareness. They felt it was secondary as compared to actually solving consumers’ needs. By developing a product that everyone used and loved, it was indeed easy for them to get traction.
However, they realised later on that they needed to build brand awareness on the supply side, particularly with property agents or developers.
“For example, we realised a lot of people were enquiring with our in-app chat feature, but because brand awareness was not strong on the agent side, they were not getting responses as agents were not entering our platform to answer those enquiries. We ended up running a lot of campaigns to help them download the app, understand the system, and how to get access to those enquiries,” explained Darius.
They would conduct weekly trainings to help agents and their teams better understand their tools, and eventually moved online in a form of a digital library that offers short-form video tutorials.
Now, Darius claims that almost every agent has 99.co’s app installed on their phones, and they also regularly use their tools for their agent business.
Scaling to Southeast Asia
Within two years of inception, 99.co made its move to scale regionally with a target to enter six countries. It started launching in Indonesia first, but got a “rude shock” because the landscape there was completely different from Singapore’s.
“Even though the intent and motivations were the same for consumers, agents, developers and banks, the market, behaviour, development cycle, regulations and supply and demand were all vastly different. Because property was such a complex subject, it was a challenge for us founders to have to learn what the market was, and to find local talent who knows it deeply,” shared Darius.
They needed to build local teams and adapt their product to serve that market, and this includes changing up their business model.
With a strong focus on Indonesia, they eventually managed to “crack the market” and now hold 80 per cent of the market share in terms of the audience.
We are now looking to do the same for other markets, and that will continue to be one of the challenges. There’s a common saying that Southeast Asia is not a single 600 million market because each market is different.
That’s even more true for property, where it is more complex than regular e-commerce. It is not something that money can solve. You actually need a very deep expertise skillset and product adaptation.
– Darius Cheung
Most recently, 99 Group raised US$52 million in a Series C round, bringing its total funding to over US$80 million.
In Singapore, 99 Group operates 99.co, SRX.com.sg and iProperty.com.sg, while in Indonesia, it operates 99.co/id and Rumah123.com.
This latest injection of funds will be used to further build their presence in Singapore and Indonesia, continue its investment in innovation and research and development, as well as expand to new markets in Southeast Asia.
When it comes to expansion, he shared that the company plans to be in one new market in 18 months, and two new markets in 24 to 36 months.
To identify which markets they expand into, they look at the market size, development cycle, opportunities, and the competitive landscape.
Their revenue grew tremendously despite COVID-19
While most businesses have been badly impacted by COVID-19, Darius feels that the pandemic has actually been good to them. After all, the pandemic did not change the demand for property as homes continue to be a necessity.
99 Group witnessed over eight times growth in sales from the first quarter of 2019 to 2022, and over four times growth in traffic to 30 million per month over the same period.
“We saw our revenue grow tremendously during COVID-19, and that was riding a momentum we already had prior to COVID hitting the market,” said Darius.
Furthermore, the pandemic accelerated digitalisation, which shifted the way home viewings were conducted. In line with the restrictions, they rolled out a “Remote Viewing” feature that allows agents to conduct a live or recorded video viewing.
Although the restrictions have greatly relaxed now, a lot of the work that has gone into digitalisation remains as people realise how much time this helps them save as they can quickly eliminate options that don’t fit the bill.
Moreover, 99.co has rolled out various features over the years that allow users to access transaction data, floor plans and site plans, which helped to ease their online journey.
“From a company growth standpoint, we have grown tremendously well. From pre-COVID to throughout COVID, we have been able to achieve a dominant position. A market leading position in Singapore and Indonesia is quite a testament, given how tough the competition is.”
Darius gave a lot of credit to his 150-strong team for this achievement — praising their resilience and relentlessness in navigating through the ups and downs. Due to COVID-19, they have had to quickly adapt, and develop or change its roadmap entirely.
Looking back at 99.co’s growth so far, Darius said that there has been no single turning point that contributed to this. Instead, he finds that their growth is reflective of the Japanese-derived “Kaizen” philosophy, which refers to continuous improvement.
[It’s all about] improving [that] one per cent every day — this is especially true to us. There are many edges to this marketplace, from what to fix to what to improve next, all the while considering the impact it has on our stakeholders.
It’s a very, very iterative process. At any point we have 10 bronze bullets, we don’t believe in a single silver bullet. We also don’t believe in 100 lead bullets and [the idea of] just spray and pray.
– Darius Cheung
Unlike giants like Tesla and Apple that stake itself on “one sexy product that sells really well”, 99.co cannot afford to adopt this approach because if that product fails, they also fail.
“Our business difference is the marketplace is inherently complex, and more so for property. This is why our philosophy is very much aligned with iterative process and the Kaizen philosophy,” he added.
What’s next for 99.co?
The problem that 99.co is trying to solve is so deep and wide, such that whatever they are doing now is merely “scratching the surface,” commented Darius.
In Indonesia, there are 10 million young people who have yet to own a house. There are millennials that are married and have kids, yet have no space to create their own family.
This backlog stems from affordability, and the problem widens as property prices increase faster than income levels. The longer they wait, the wider the gap, which becomes an increasing problem.
Our goal, at the end of the day, is not just about property search. We are in the business of helping people find a home. And finding a home is not just about helping people find a great listing for those who can afford it, because their problem is simply choosing what’s best for them. We have already gotten quite good at doing that already.
The next step is really helping people who don’t even have access. How can we — whether it’s ourselves, or in partnerships with banks and other financial institutions — find ways to help people bridge the affordability gaps?
– Darius Cheung
He added that having investors invest and put capital to work would help bridge this affordability gap.
While he expects the regional property market to witness a huge boom over the next 20 years, investors are unfortunately not pumping in much money in the Southeast Asia market now because the returns and regulations are quite fuzzy, and they are unsure of what opportunities they can tap on.
“If we can solve things like affordability issue [and] investment opportunities, that incredibly deepens our contribution to the economy, individual lives, and even the nation as a whole; and I think that’s what excites me the most.”
“Conversely, because of how big and how important [the property industry] is, it tends to move slowly. That’s the frustration — buying a property is a slow [and] low-frequency process. Because of [it], moving and changing things is slow. But we have the patience, and I think that’s the benefit of being a bit older and a second-time entrepreneur. I’m not in a hurry to get results tomorrow.”
At the end of the day, 99.co is focused on helping people make the best property decision, and that itself is a never-ending journey.
Lessons learnt, as told by a serial entrepreneur
With some successful and failed ventures, Darius’ colourful entrepreneurial journey has taught him two key things: people and culture.
People are what matters. Selecting the right people — the right co-founders, the right first few hires — really sets the tone and culture for the company. In my own experience as an angel investor, these are companies which I invested [in], but have no idea what they do.
But you can just see who the people is at an early-stage — how hard they work, what’s the drive, and what their purpose is. Having that alignment is really important, especially for the first 10 people you hire.
– Darius Cheung
After nailing down that first 10 people, the next important thing to look at as you grow to 50 people, is building culture. Founders need to think carefully about how they onboard, train and evaluate hires; as well as how they “infuse culture”. The latter is especially important for Southeast Asia, where a lot of mergers and acquisitions, and consolidation happens, noted Darius.
Underscoring the importance of these two pillars, Darius confessed that he has made mistakes in these areas. Often times, he either under-estimated or under-invested because they feel like a far-fetched correlation to actual profits and revenue.
“But this is actually the most important. It’s like a tree where the roots are the most important, not the branches. And culture is the root of the company,” he stressed.
Finally, he cautions first-time founders who are hesitant on embarking on a new venture to simply not start at all. “Starting a company is not for the faint-hearted,” he quipped.
Since the startup journey is so tough, he feels that most entrepreneurs have harboured thoughts of giving up. It happens when something blows up, goes wrong, or when you have to make some sacrifices. You will start questioning why you’re doing this, though this is a normal feeling regardless of what job you’re in.
“I don’t think having thoughts of giving up is material. I think the choice to push through is what’s important. That is also the line [that differentiates] winners [from] losers,” he said, adding that the startup journey is more like a marathon, so founders should be careful not to sprint and exhaust themselves at the start of the race.
After getting past the initial product market fit, the initial 10 people and the initial revenue, the growth of the business ultimately boils down to a matter of leadership.
“As a leader, one of the advice I would have is to find your leadership style and define your culture. It’s such an important, pivotal thing to do,” he advised. “Also, march to your own beat. You don’t have to take every piece of advice. It has to fit who you are as a person, and what team and company you are running.”
Featured Image Credit: Beamstart