News Corp Australia will use its 25 per cent stake in Sydney-based home improvement site Hipages to expand the company’s exposure in the property and services category in Australia, initially through community newspapers.
Hipages provides a free service for people seeking quotes for repairs or renovations, and generates its revenue by charging the more than 66,000 tradespeople listed on its website.
News acquired its holding in the online company earlier this week, an investment Hipages will use for product development to further its growth.
From a start-up 11 years ago, Hipages now employs 200 people, Last year it increased its revenue by 44 per cent year-on-year,
Hipages chief executive David Vitek estimates the home improvement market to be worth $90 billion a year, and hopes to transform the company into the sector’s equivalent of online real estate company REA Group.
In an interview with The Australian, Mr Vitek said the company had come a long way from its origins in a garage in 2004. “While we’re very proud of the growth we’ve had so far, we know Hipages is just getting started,” he said. “We look forward to working with our new strategic investors to continue to develop the platform, grow the Hipages team, and accelerate marketing.”
From News’ perspective, there are synergies that can be developed between Hipages and REA Group, with the majority-owned News online real estate company branching into related services.
News Corp Australia’s managing director of community publishing Brett Clegg said Hipages provided great synergies with News’ current activities in the property and home services category.
“News Corp is already the advertising partner of choice for a large number of property and home services businesses, and adding the Hipages’ product to the offering will further benefit the category as a whole,” he said.
Mr Clegg also said News was looking to use its multi-platform reach to grow the business. “News Corp will participate in the positive commercial development of Hipages and further accelerate the growth through its reach in audience,” he said
Hipages would be featured initially across News’ community papers, making it easier for readers to hire tradesman in their local areas.
“The market place for classifieds has seen significant disruption through new digital business models, especially in trades and services,” Mr Clegg said.
“At the same time the trades and services industry is enjoying high growth, and a positive future outlook on the back of the expanding housing and real estate industry in Australia.”
Other Hipages investors include Ellerston Capital, led by Ashok Jacob; Sydney-based Right Click Capital, with a portfolio in tech companies; and Australian Ethical Investment, an environmental and socially responsible investor.
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