The Hosteller Raises ₹150 Crore Led by PROMAFT Partners in Series B Funding — Solidifies Backpacker Hostels as a Category Defining Force in Indian Hospitality
New Delhi : The Hosteller, India’s largest branded hostel chain, has raised ₹150 crore in a Series B round led by PROMAFT Partners and V3 Ventures, with participation from ITI Growth Opportunities Fund, Merisis Wealth Trust, and prominent family offices. This is the largest institutional funding round ever raised by a backpacker hostel company in India.
This fundraise marks a pivotal moment for the company as it cements its leadership in India’s rapidly growing backpacking and experiential travel segment. The Hosteller plans to deploy the fresh capital towards accelerating its expansion across key travel destinations, while further strengthening operational efficiencies and brand building.
Founded in 2014, The Hosteller today operates 75+ properties across 13 states and has hosted over 20 lakh unique travellers. Over the past 12 months, the company added 30+ properties and grew traveller capacity by nearly 70%. The company’s vertically integrated business model has already demonstrated highly consistent customer experience and strong unit economics with industry leading hostel level profitability and growth. The company is targeting 25,000 beds nationwide within the next 36 months and is preparing to launch a travel super app integrating accommodation, F&B, mobility, and curated experiences into a single platform.
Pranav Dangi, Founder and CEO, The Hosteller, said: “We started The Hosteller because Indian travellers deserved better than a choice between overpriced hotels and unreliable budget stays. 11 years and 20 lakh travellers later, the model has proven itself. This round is about sustained acceleration to 25,000 beds, a full stack travel platform, and building the kind of company that can define this category for decades. We are on a path to building a truly public, enduring hospitality brand out of India.”
Soham Avlani, Founding General Partner, PROMAFT Partners, said: “India’s travel market is being reshaped by a generation that values experience over star ratings, and we believe The Hosteller is best positioned to lead that shift. The unit economics of this business are exceptional. The occupancy, the repeat rates, and the revenue per bed all outperform what we see in budget hotel chains at comparable price points. He chose substance over vanity scale, and built something that actually works at the unit level — property by property. When your customers are choosing destinations based on where your brand opens next, you are not a hostel company. You are a travel platform.”
This is PROMAFT Partners’ second investment from its debut $100 million Series A/B fund, following its investment in Wiom.
Arjun Vaidya, Co-Founder, V3 Ventures, said: “We have been with Pranav since the Series A in 2024, and what he and his team have delivered since is remarkable, including the expansion pace, the consistency of experience across 75+ properties, and the operational discipline. The growth and performance metrics have been exceptional. Continuing to back the company in this round was one of the easiest decisions we have made as a fund.”
Mohit Gulati, CIO, ITI Growth Opportunities Fund, said: “India’s experiential travel segment is still early, and Pranav has built the only brand in this space that a traveller actively plans around. The Hosteller is one of those rare businesses where the unit economics tell the story better than any pitch deck. Occupancy, repeat rates, revenue per bed — the numbers hold up property by property, across geographies and seasons. ITI Growth Opportunities Fund is excited to back the category leader as it scales towards becoming a defining public hospitality brand out of India.”
With this round, The Hosteller becomes the best capitalised hostel company in India, and the most credible contender to build a public hospitality brand from the category.
Merisis Advisors were the exclusive advisors to The Hosteller for this transaction.
