To use funds for investments in guest experience, brand building, technology, and expansion.
Treebo Hotels, India’s largest budget hotel chain, has raised $34 Million (INR 220 crore) in its Series C funding round led by Hong Kong-based investment firms Ward Ferry Management and Karst Peak Capital. Existing investors, SAIF Partners, Matrix Partners India, and Bertelsmann India Investments also participated in the round.
Founded in 2015, Treebo Hotels is a technology-enabled budget hotel brand with close to 300 franchisees operating exclusively under its brand across more than 50 cities. The company offers high-quality accommodation options to travelers in the Rs 1,000-3,000 per night price range.
Commenting on the fundraise, Sidharth Gupta, co-founder, Treebo Hotels said, “Ward Ferry and Karst Peak are both seasoned investors in the global markets including in the travel and hospitality space. Between them they have invested in hotel chains, cruise ships, OTAs, F&B chains, duty free shops, and several other sub-segments within the space. We are glad that our approach of building a sustainable, long-term business resonated with them. We feel privileged to have them onboard and look forward to leveraging their experience in driving business growth.”
Treebo will invest the fresh funds into enhancing customer experience, building a stronger brand, strengthening its technology team, and expanding its footprint in existing and new cities. It is already the highest-rated hotel chain in this segment as per data from review portals like TripAdvisor and Booking.com
Rahul Chaudhary, co-founder, Treebo Hotels said, “We pioneered the technology-enabled franchise-based model in the budget hospitality segment in India. We have several breakthrough initiatives in the offing to further enhance the experience we offer to our guests, and the value we create for our franchise partners. This new capital will allow us to invest in these endeavours. We are thrilled to receive continued support from new and existing investors.”
Founded in 2015 by ex-Myntra/ McKinsey/ MakeMyTrip executives, Sidharth Gupta, Rahul Chaudhary, and Kadam Jeet Jain, Treebo works with new and existing hotels on a franchise model where Treebo offers its brand name, quality oversight, access to leading vendors, staff training, and sales and marketing expertise to the property, thereby enabling higher revenues for the franchise partner and a superior experience for the customers.
Prior to this round, the company had raised a total of $23M over two rounds from SAIF Partners, Matrix Partners India, and Bertelsmann India Investments.
About Treebo Hotels
Founded in June 2015, Treebo Hotels is India’s 3rd largest hotel chain overall and largest in the budget segment. It is the brainchild of ex-McKinsey and Myntra executives Sidharth Gupta and Rahul Chaudhary, and ex-VP of engineering at MyGola Kadam Jeet Jain. Treebo Hotels offers a quality accommodation alternative to India’s $20 billion unorganized and fragmented budget segment. Treebo works on a full inventory model with carefully selected, existing, stand-alone hotels and prescribes the quality standards to which hotel operators need to adhere, and helps them achieve those standards through staff training, bulk contracts with vendors, and technology implementation. Treebo is the largest network of branded budget hotels with more than 6,000 rooms across ~300 properties in over 50 major cities in the country. It offers its guests value-for-money by providing branded toiletries, complimentary breakfast and free Wi-Fi.
About Karst Peak Capital
Karst Peak is an asset management firm based in Hong Kong. Karst Peak invests in public and private companies throughout the Asia Pacific region, with particular emphasis on consumer, technology, and healthcare businesses in Greater China, India, South Korea, and Southeast Asia. Karst Peak’s team makes selective, long-term investments in emerging companies with strong brands, defensible business models, and outstanding management teams. Karst Peak was established in 2012.
About Ward Ferry Management
Ward Ferry is an independent investment firm founded in 2000 and based in Hong Kong. The firm manages long-only investment funds focused on the Asia Pacific region for global institutional investors. The firm follows a bottom-up fundamentals-driven, “private equity” approach investment strategy. The firm’s core areas of investment focus are consumer, retail, financial services, internet/technology, media, education, healthcare and travel/leisure. The firm primarily invests in public companies, but will make selective private company investments.
About Bertelsmann India Investments
Bertelsmann India Investments (BII) is a venture capital fund of Bertelsmann, a media, services and education company that operates in about 50 countries around the world. BII focuses on series B and C stage investments in pioneering companies in the digital, education, media and services sectors. Since its official launch in 2012, BII has invested in 10+ companies including Saavn (music streaming service), Pepperfry (online furniture marketplace), iNurture (higher education services) and Lendingkart (digital lending platform for SMEs). BII is part of Bertelsmann Investments, which houses the group’s other corporate funds such as BAI (China), BDMI (US and Europe) and BBI (Brazil) and cumulatively has approx. 150 investments.
About SAIF Partners India
SAIF Partners is a leading venture capital firm with over $4B under management. SAIF provides seed, early, and growth stage capital for emerging companies in India and China. SAIF began partnering with entrepreneurs in India in 2002 and has backed over 40 companies since then including market leaders like MakeMyTrip (NASDAQ listed, online travel), JustDial (NSE listed, online classifieds), PayTM (e-commerce and payments), BookMyShow (events ticketing), and Urban Ladder (home decor e-commerce), PropTiger (online real estate) among others.
About Matrix Partners India
Matrix Partners India is an investment firm with INR 4,500 crore under management. The firm invests in companies targeting the Indian consumer and enterprise markets at the seed, early and early growth stages. The firm has invested in several market leading companies in the consumer technology space including Ola (local transportation), Mswipe (mobile POS), Quikr (online classifieds), Practo (digital health platform), Dailyhunt (mobile local language platform), Five Star Finance (SME lending), Treebo (digital hotel chain), Limeroad (mobile social commerce marketplace), OfBusiness (B2B marketplace) and Razorpay (payments) among others. Matrix Partners has a global network of funds investing in the US, China and India with US $4 billion under management.
