MyGate secured $56 million in Series B,lays off 120 staffs

Security and convenience platform MyGate ,which claims empower 3.5 million homes in 20 plus different cities in the country, marked by an increase in revenues , at the same time, ir has seen significant increase in net losses.

The Bengaluru-based company is claimed earned another Rs 7.6 crore from its financial assets during the same period, marked by a significant increase in expenses. Employee benefits expenditure was the biggest cost centre for MyGate in FY20. EBITDA margin saw a slight improvement and stood at -240% in FY20 as compared to margin of  -285% during FY19.

MyGate had secured $56 million in Series B round from Tencent and Tiger Global at the end of FY20. This was the largest funding round for any startup operating in the society and community management space.

“The increase in the revenue is attributable to onboarding of more number of customers (Viz., Resident Welfare Associations, FM Companies, etc.) on our Security & Community Management Solutions,  which lead to increase in the topline for FY 20,” Vijay Kumar Arisetty, the company’s co-founder and CEO told .

MyGate saw its total employee benefits expenses shoot up by 144% in FY20 to Rs 49.88 crore compared to the previous fiscal. At the same time, it’s rental expenses paid out during this pre-Covid fiscal also blew up 4.1 times to Rs 3.73 crore in FY20.

During FY20, legal and professional fees paid out by MyGate jumped 4.6 times to Rs 5.8 crore, and advertising and promotional expenses grew by 180.8% to Rs 3.65 crore during the same period.

MyGate spent Rs 5.16 to earn a single rupee of operating revenue during FY20. With this MyGate has asked hundreds of its employees to quit over the last few months.

Five former employees of the company who were asked to resign after April told us that the company has let go of anywhere between 500-700 employees across multiple branches, citing poor performance.