New Delhi, April 16 -- Budget hospitality chain The Hosteller Hospitality Pvt. Ltd has raised Rs 150 crore (around $16.1 million) in a Series B funding round led by Promaft Partners and V3 Ventures, with participation from ITI Growth Opportunities Fund, Merisis Wealth Trust and family offices.
VCCircle had reported last year that the company was in talks with V3 Ventures to raise fresh funding.
The company said the round is the largest institutional funding raised by a backpacker hostel operator in India, and that it plans to use the capital to expand across key travel destinations, improve operational efficiencies and strengthen brand presence.
Founded in 2014, The Hosteller operates over 75 properties across 13 states and has hosted more than 2 million travellers.
The company plans to scale up to 25,000 beds over the next three years and is building a travel super app integrating accommodation, food and beverage, mobility and curated experiences.
"We started The Hosteller because Indian travellers deserved better than a choice between overpriced hotels and unreliable budget stays," said Pranav Dangi, founder and chief executive officer, The Hosteller.
"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," he added.
The Hosteller's revenue from operations stood at Rs 71.52 crore in the financial year through March 2025, up from Rs 47 crore in the fiscal before. The growth came at rising expenses, with the company's net loss ballooning to Rs 15.4 crore in FY25 from Rs 3.8 crore in the previous year.
Merisis Advisors acted as the exclusive advisor to the company on the transaction.
This marks Promaft Partners' second investment from its $100 million debut fund, after backing New Delhi-based internet technology company Wiom.
Published by HT Digital Content Services with permission from VC Circle.