Backpacker hostel chain, The Hosteller, has raised $4 million (around Rs 32 crore) in a Series A funding round led by V3 Ventures. Other participants include LV Angel Fund, FAO Ventures, Synergy Capital Partners, and several family offices in real estate. With this investment, the startup’s valuation has reached approximately Rs 200 crore (around $25 million).
Growing Presence Across India
Founded in 2014, The Hosteller is known for providing affordable and quality stays for budget travelers. Currently, they operate in over 60 locations, including major cities and scenic spots like Himachal Pradesh, Uttarakhand, and Karnataka. The company focuses on offering consistent service through its self-operated model, ensuring travelers receive a standardized backpacking experience.
According to Pranav Dangi, Founder and CEO of The Hosteller, the company is committed to delivering exceptional travel experiences. They have launched “Glu,” a tech concierge, to enhance services and set new standards in the hospitality industry.
Plans for Over 150 Locations
The Hosteller plans to use the new funds to expand significantly. Their goal is to grow to over 150 locations across India within the next 24 to 30 months. V3 Ventures Co-Founder Arjun Vaidya expressed confidence in The Hosteller’s success, highlighting its strong presence in the travel and hospitality space.
The startup aims to strengthen its presence in metro cities while also entering new travel destinations. The focus remains on providing high-quality and immersive experiences for backpackers.
CFO Insights on Financial Growth
The Hosteller’s Chief Financial Officer, Saksham Khemka, noted that for the fiscal year ending March 2024, the company generated Rs 55 crore in revenue, with positive net margins. He shared that the company plans to add 50 more properties by the end of the year. They aim to maintain growth momentum by adding four to five new hostels each month.
The capital infusion will help accelerate their expansion while ensuring service standards remain high, as they meet the growing demand for budget-friendly travel accommodations.
