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The Hosteller, a backpacker hostel chain based in Mumbai, has secured INR 150 crore in a Series B funding round led by PROMAFT Partners and V3 Ventures, with participation from ITI Growth Opportunities Fund, Merisis Wealth Trust and several family offices. The capital infusion is intended to support the company's expansion across key travel destinations in India, alongside investments in operational efficiency and brand development. The company has outlined plans to scale its inventory to 25,000 beds over the next 36 months while advancing its position in the organised budget hospitality segment. It is also preparing to introduce a travel-focused super app integrating accommodation, food and beverage services, mobility, and curated travel experiences into a single digital platform.
Mumbai-based backpacker hostel operator The Hosteller has raised INR 150 crore in a Series B funding round led by PROMAFT Partners and V3 Ventures, with participation from ITI Growth Opportunities Fund, Merisis Wealth Trust and a group of family offices, as the company seeks to expand its footprint across India's travel destinations and strengthen its hospitality platform. Advertisement
The funding, announced in the past week, is aimed at accelerating the company's growth strategy, which includes scaling its hostel network, improving operational efficiencies, and investing in brand-building initiatives. The Hosteller operates in the budget accommodation segment, catering primarily to young travellers and backpackers across key leisure markets.
According to the company, the newly raised capital will be deployed to expand its presence across high-demand travel locations, with a focus on increasing bed capacity significantly over the medium term. The firm has set a target of reaching 25,000 beds within the next 36 months, indicating a substantial scale-up from its current portfolio.
Founder and chief executive Pranav Dangi indicated that the funding marks a phase of sustained growth for the company, with an emphasis on building scale and strengthening its position in the organised hostel segment. He stated that the company is working towards developing a long-term hospitality brand from India, with ambitions to establish a platform that could operate at scale over several decades.
In parallel with its physical expansion, The Hosteller is planning to introduce a digital travel platform designed as a super app. The proposed platform will integrate multiple travel-related services, including accommodation bookings, food and beverage offerings, local mobility solutions, and curated travel experiences, within a single interface. This move reflects a broader trend among hospitality operators to diversify service offerings and build integrated ecosystems aimed at enhancing customer engagement.
The participation of institutional investors and family offices in this funding round highlights continued investor interest in India's organised budget hospitality and travel segments, particularly in scalable, asset-light business models. The Hosteller's expansion strategy is expected to focus on both strengthening its presence in established tourist circuits and entering emerging destinations where demand for standardised, affordable accommodation is growing.
With this latest capital infusion, the company is positioning itself to expand both its physical infrastructure and digital capabilities, as competition intensifies in the budget hospitality segment driven by rising domestic travel demand and increasing formalisation of the sector.
Source - PTI
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