The Hosteller Secures $4 Million in Series A Funding to Fuel Nationwide Expansion

The Hosteller chain of backpacker hostels has raised $4 million (about ₹32 crores), with additional backing from its current investors, including LV Angel Fund, FAO Ventures, Synergy Capital Partners, and Ice.VC.

Thanks to this new fundraising round, the Hosteller is now valued at around ₹200 crore, or about $25 million. This puts it in a position to proliferate as it looks to spread throughout India.

An Excursive Growth Path Since 2014

Established in 2014, The Hosteller has emerged as a leading brand for reasonably priced hostel accommodations, providing high-caliber and engaging travel experiences. Operating out of over 60 locations throughout India, including busy metropolises From calm scenery in Himachal Pradesh, Uttarakhand, and Karnataka, The Hosteller persists in meeting the demands of tourists on a tight budget.

The Hosteller offers a standardized experience for its visitors, guaranteeing comfort, convenience, and a genuine travel experience while focusing on maintaining quality through its self-operated model. With the launch of Glu, its comprehensive digital concierge service, the business is also leading the way in technological innovation in the hotel sector.

Ambitious expansion Plans

The additional cash will support Hosteller’s aggressive expansion plan, which calls for reaching over 150 locations in the next 24 to 30 months. The organization intends to grow its reach and bolster its foothold in established metropolises by exploring new tourist destinations around India.

Regarding the company’s future plans, Pranav Dangi, the founder and CEO of Hosteller, said, “With this funding, we can continue to provide our expanding community of backpackers with high-quality, immersive travel experiences while broadening our reach. We are changing the hospitality business by introducing new technologies and growing steadily.”

Investors See Growth Potential for The Hosteller

Co-founder of V3 Ventures Arjun Vaidya noted, “The Hosteller has shown remarkable execution in the travel and consumer space,” expressing confidence in the company’s development potential. We are thrilled to support them on their path as they grow and enter new markets.”

Exceptional Financial Results

Financially speaking, Hosteller stated that its top-line income for the fiscal year that ended in March 2024 was ₹55 crore, with a profit margin. Maintaining its remarkable development trajectory, the firm is also on target to add 50 new properties by the end of this year.

Regarding the financial advantages of the investment round, Saksham Khemka, CFO of The Hosteller, said, “This capital infusion allows us to scale up operations at an accelerated pace while maintaining the high service standards our guests expect.” Given our observed demand, we can open four to five more hostels per month.