SUMMARY
- The Hosteller has secured $4 million in its latest Series A round led by V Cube Ventures.
- Lets Venture Angel Fund, Angelist, and other investors also participated in the round.
- The investment will be utilized for the development of additional hostels, marketing initiatives, and other strategic endeavors.
Backpacker hostel chain The Hosteller has secured $4 million, or Rs 32 crore, in its latest Series A round led by V Cube Ventures, with contributions from Lets Venture Angel Fund, Angelist, and other investors.
The Board of The Hosteller has authorized a special resolution to issue a combination of 10 equity shares and 64,281 Series A compulsory convertible preference shares at an issue price of Rs 4977.5 each, to raise a total of Rs 32 crore or $4 million, as per documents obtained from RoC.
V Cube Ventures, contributed Rs 22 crore, with additional contributions from LV Angel Fund, AngelList, and Merlin Marketing, amounting to Rs 2.5 crore, Rs 50 lakh, and Rs 1.5 crore, respectively. The rest came from 14 other angel investors.
The investment will be utilized for the development of additional hostels, marketing initiatives, and other strategic endeavors.
Post receipt of the fresh capital, V Cube Ventures is set to hold a 15% stake in the company, followed by Lets Ventures with a 3.45% stake. Pranav Dangi, the founder and Chief Executive Officer, along with his family, holds a 35.28% stake in the company.
The funding has bridged a three-year investment gap as it closed its $1 million Seed Funding round in 2021. It has also elevated The Hosteller’s valuation, with the company estimated to be valued at approximately Rs 182 crore or $22 million post-investment.
Founded in 2014, and currently having over 50 hostels across India, The Hosteller has established itself as a leading provider of experiential, affordable, and high-quality accommodation for backpackers. The company has demonstrated impressive financial performance, achieving a revenue of Rs 55 crore in FY24, with a net profit of Rs 4 crore. The company is set to expand its footprint by adding 75 new properties this year, positioning itself as a formidable competitor in the market.
The company competes in the market alongside other notable entities such as goSTOPS, Wudstay, and Backpackers Panda.
Source: Entrackr
