Blume Ventures in talks to lead Rs 35 crore round in backpackers hostel startup GoStops

GoStops, the youths focussed backpackers hostel startup, is in talks to raise Rs 35 crore in a fresh funding round led by Blume Ventures, sources in the know told Indian Startup News (ISN). 

Blume is likely to invest around Rs 25 crore in the Delhi-based company and the remaining will come from existing angel syndicates and small investors. 

GoStops counts 1Crowd, Indian Angels Network, Early Angels, The Chennai Angels and others as its early backers which will facilitate the fresh investment and help investors increase th

GoStops, the youths focussed backpackers hostel startup, is in talks to raise Rs 35 crore in a fresh funding round led by Blume Ventures, sources in the know told Indian Startup News (ISN). 

Blume is likely to invest around Rs 25 crore in the Delhi-based company and the remaining will come from existing angel syndicates and small investors. 

GoStops counts 1Crowd, Indian Angels Network, Early Angels, The Chennai Angels and others as its early backers which will facilitate the fresh investment and help investors increase their ownership in the company. For the company, which was founded in 2014, the ongoing round will be its largest so far. 

It has previously raised a total of Rs 25 crore since 2019, including Rs 8 crore in December 2021, according to media reports. 

“The company ended FY24 with a revenue of Rs 30 crore with a healthy bottom line. With the help of fresh capital, GoStops will aim to grow exponentially and reach a revenue milestone of Rs 200-215 crore by end of FY26,” a source told ISN on the condition of anonymity. 

GoStops and Blume Ventures have not responded to ISN’s email. If the companies reply we will update the story.

The startup is already close to being profitable, as per sources. It had a negative EBITDA of Rs 2-4 crore as of FY24 but is confident of turning the business around and generating as much as Rs 50 crore in EBITDA profits by the end of FY26, the source added. 

GoStops was born out of the need for quality travel accommodation for youth which is currently a big market gap. Accommodations that cater to the price-point of Rs 500 per night are GoStop’s main target audience, as it is both large and growing.

Airbnb, Cleartrip, Cox and Kings, Indian Railway Catering, MakeMyTrip and other aggregators, are some of the major market participants along with GoStops.

The startup, which was founded by husband-wife duo of Pankaj Parwanda and Pallavi Agarwal, also competes closely with Tiger Global-funded Zostel. While Zostel has a wider reach, GoStops is present in over 15 states in India and is constantly growing.

It has hosted over 6 lakh guests by running over 40 hostels across the country. 

It also has global ambitions. Co-founder Parwanda had earlier said the company plans to set up operations in Nepal and Sri Lanka but is yet to formally announce those plans. The execution will likely gather pace once the company has more funds in its bank accounts.

“We are on an exciting journey towards building India’s largest and most loved youth hostel brand. Our mission is to ensure that young Indians never have a bad travel experience,” Parwanda said on his LinkedIn.