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Startup Name: The Hosteller
Tagline: Your perfect pit stop
Founders: Pranav Dangi and Sumit Mishra
Year of founding: December 2014
Funding Status: 1 crore rupees
One of the most common problem faced by backpackers is a cost effective stay, most of the hostels are unhygienic and unfit to live. The hosteller is bridging the gap of hospitality in India, where they provide comfortable yet cost effective stay.
The Hosteller is a European styled budget yet plush accommodation for backpackers from all over the world. The hostels with dormitory-style and basic private rooms, are for those nomadic souls who are looking for a standardized offering between budget hotels and couch surfing.
About Hosteller’s Hostels
The Hosteller is much more than just accommodation. While offering all basic amenities like air conditioning, wi-fi, breakfast, female-only room options and lockers at a minimal price (beds starting @ INR 299 per night), their designed focused hostels are more about building the perfect ambience for communal living and social travelling. Their lavish common areas like library & work- space, shared kitchen, lounge & gaming area, open balconies, and services like 24- hour travel desk facilitate a lot of interactions amongst travelers, making it the perfect traveler’s meeting point.
They also conduct live events for in-house travelers as well organize open city events inviting locals to be a part of the idea of social living.
About The Hosteller
The Hosteller was founded by Pranav Dangi and Sumit Mishra.
Pranav the CEO at The Hosteller, is an avid traveler, having travelled over 18+ countries worldwide. After three years of corporate madness, he finally decided to start a new chapter in his life. Sumit, Partner at The Hosteller, has a total of 4 year of travel industry experience with companies like Yatra.com, Travel Triangle etc. With a varied background in the industry, he comes with a lot of first-hand experience, thereby adding value to the overall functioning of the company.
When asked about the inception of the idea, Pranav says,
While travelling in Europe, we got stuck late at night in Geneva, Switzerland. There were no trains for us to get back to our exchange college in Marseille and we were left with only one option of staying back for the night in Geneva. Then came the toughest job of finding a place to crash. Being on a very tight budget, we started looking out for hotels but all in vain. All hotels were at least 15 times more expensive than hostels. We, finally, slept in a super-clean & lively hostel, had a nice breakfast in morning, explored Geneva a little more and left home the next day happily having spent only 15 euros in all. It made me contemplate the similar situation in India and the ideas just kept coming. And, then The Hosteller happened.”
Pranav says,
Our listing on the online travel agents/platforms (OTAs) in Jaipur gave us our first customer on Day 1 itself. Setting a target of selling 60 nights in first month and achieving 220 nights was a huge boost for our team.
With no hospitality background whatsoever, it was like stepping in cold water for the team when The Hosteller started in Jaipur in December 2014. Learning about hotel infrastructure, legal frameworks, managing the staff, purchasing & inventory management and customers query management gave the team enough confidence to open up the second hostel at Delhi by April 2015. Our 3rd hostel at Kasol, Himachal Pradesh, started in May 2016, made us stretch our limits to offbeat places.
The Hosteller, since inception, has served more than 9000 travelers from all around the world with almost 25000 nights spent at 3 of its locations. Our local to foreign travelers’ ratio stand at 40:60 and we hope the ratio to improve as Indian travelling youth is still unaware of these kind of new and upcoming backpacker hostels. We have a vision to make India more travel friendly and are quite zealous to make our vision come true.
The Hosteller has multiple revenue channels like bed sales (biggest contributor), articles sales, travel desk revenue, events sales etc. The Hosteller in coming 3 years has a solid expansion plan in place in terms of property expansion as well as adding more sources of revenue under its brand name. The company plans to enter into 2 to 3 Tier-1 cities and 8 to 10 Tier-2 or Tier-3 cities the end of 2017 taking the total bed count to 1000+. After initial bootstrapped funds they raised first round of funding of around 1 crore last year. The Hosteller is looking to raise more capital to be used primarily for property expansion, marketing and support of technology driving more business leads.
The Hosteller is directly competing with players like Zostel and Vedanta Wake up chain of hostels. Also they are competing with all those alternate accommodation providers like guesthouses, BnBs and budget hotels.
The Hosteller believes that by providing Design-conscious budget accommodation, quality of accommodation, ease in booking, interesting offers with dynamic price points, standardized services like strong Wi-Fi & refreshing breakfast and efficient use of technology to create a travel app that act as a one stop shop etc. they can outpace the competition.
Rapid Fire Round with Pranav
What is the biggest challenge you faced as an entrepreneur while establishing your startup?
Hospitality Industry, especially in India has been mostly driven by local & influential people and has been known for a lot of activities apart from just accommodation. To enter into an already congested industry with little support from family for funds initially was a major hurdle. Hostels, being a fresh and new idea, have no legal framework or government regulations and thereby it posed a great challenge for us.
How did you overcome it?
We are working on forming an industry association consisting of all the alternate accommodation providers and pitching our plan to the government to define licensing frameworks for the industry.
What is the biggest learning so far in your entrepreneurial journey?
The most important thing for a great idea to succeed is to have an amazing team. Over the period, our start-up realized it and shaped up to create good value for our customers and develop our team simultaneously.
What is your tip for entrepreneur raising funding?
Don’t be greedy initially. Focus more on the executing the idea and building a great team with the funds. If you score high on these parameters at an early stage, then getting funds at later stage to create high value out of the business won’t be a big hurdle for most of the startups.
What’s your tip for newbie entrepreneur?
Dive in with all your heart in starting your own start up & then don’t give up. Working hard is the only way out.
The article was first published in The Cofounder. The Cofounder is India’s first print magazine which writes about early stage startups and entrepreneurship.
