Backpacker hostel chain The Hosteller raises Rs 48 crore in funding for nationwide expansion

Homegrown backpacker hostel chain The Hosteller today announced the completion of its Series A funding round, securing a total investment of Rs 48 crore.

The equity investment was led by V3 Ventures along with participation from Synergy Capital Partners, Unit e Consulting LLP, Real Time Angel Fund (Climber Capital), Ice VC led by Mrunal Jhaveri, and AL Trust (Thrive Ventures). 

Notable individual investors joining the round include Harsh Shah from the Naman Group Family Office, Akash Hiren Zaveri, founder of Plix and Vedang Patel, founder of The Souled Store. 

The startup also raised Rs 16 crore from Black Soil as venture debt.

Focused on nationwide expansion

Founded in 2014, The Hosteller plans to use the raised capital to expand its footprint across India, with plans to strengthen its presence in existing cities such as Rishikesh, Manali, Bangalore, Delhi, etc. while venturing into new travel destinations. 

The startup aims to maintain its robust growth trajectory while continuing to provide high-quality, immersive travel experiences for backpackers.

"This strategic investment will further strengthen our mission of delivering standardized offerings pan India enabled by tech-first approach to the backpacking community," said Pranav Dangi, Founder and CEO of The Hosteller.

According to Dangi, The Hosteller aims to have 10,000 beds by March 2026 from the existing 2,500 beds.

"Backpacker hostels have become the go to choice for GenZ and millennials travelers in the post-covid era. The fresh capital will not only accelerate our expansion but also help us acquire customers from the newer territories," Dangi added.

Arjun Vaidya, Co-Founder of V3 Ventures, said, "We noticed a change in the way Gen Z travels - from saving up for 1 holiday a year to traveling every long weekend. And, The Hosteller fulfills this exact need. With a standardized, tech first, budget friendly option - the brand offers something truly unique to its customers. This makes us even more excited about the growth ahead. The Hosteller has demonstrated outstanding execution capabilities in the consumer and travel space."