Baidu Alumna Steps into Rental Housing Business from Tech company
COVID-19 and China

Danke Apartment (蛋壳公寓) announced on June 17th that Gu Guodong (顾国栋) would be the chief operation officer, who had worked as a vice president in Baidu. Gu would be responsible for Danke’s team management and report to CEO Gao Jing (高靖) directly.

Danke Apartment, a rental housing platform company founded in 2015, is expanding at an astonishing speed and it has managed over 500K apartment in most tier-1 cities in China. It closed its latest financing round of USD 500 million in March 2019.

Gu Guodong was as a core member of Nuomi (糯米网), which was a strong competitor of Meituan Dianping (美团点评) the time. Along with the Baidu-Nuomi acquisition completed at the beginning of 2014, Gu joined Baidu in 2014 and worked in sales and marketing departments. Before his resignation, Gu sat in the vice president chair and was in charge of Baidu’s business development and management.

During the past three months, six senior management team members left Baidu and four of them had worked in Baidu for more than a decade. Ignoring the change in the executive level, Baidu, the Chinese Google, is still the best tech company in China and has contributed greatly to current Chinese unicorn companies in varied industries.

Danke Apartment invited Gu to be its COO and Gu revealed that he would help Danke Apartment to realize sustainable growth through accurate marketing, quality control, etc. Danke is a unicorn in the rental housing market considering its market value of USD 2 billion, but it is not the best nor the only one.

Ziroom (自如), the top player in the rental housing market, is valued at USD 5 billion after its latest financing closed on June 15th. Ziroom and Danke’s development is accelerated by the pumping housing price, the young who cannot afford the rent of a whole apartment will split the rent with friends and even strangers.

Rental housing platform helps to resolve the housing problem but as an emerging market, the regulation system is yet to be completed. For instance, as exposed earlier, some rental housing platforms asked tenants to sign extra loan contracts for paying the rent without notifying these contracts were prepared by the third party, the loan issuers.

The negative consequence followed did not only harm clients’ right to know but also distorted the market order to some degree. The risk burden transformed to tenants since loan issuers paid a lump sum to the platform in advance. Dingjia (鼎家), the most-known failed case of rental housing platform, shut down and left tenants with loans to pay and no place to leave. The alarm cooled down the investment heat and bring regulators attention to the financial traps in rental loans.

The above is only one problem that had existed in the rental housing market. Danke and Ziroom are the top-tier in the market and also a benchmark for all peers and followers. The fair deal builds trust and service quality solidifies the foundation of the company.

Will the join of new COO help Danke to grow steadily and soundly? Gu’s management experience in past decade and his awareness in risk management might contribute to the development of Danke Apartment, a fast-growing company in an aggressively-expanding market.

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