Matrix Partners India and SAIF Partners have co-led a $6 million first institutional round of funding for Bengaluru-based hotel startup Treebo Hotels (previously known as Zipotel). The new fund will be used for expanding its network of hotels, developing state-of-the-art technology and hiring top talent.
The startup was launched in March 2015 by Sidharth Gupta, Rahul Chaudhary and Kadam Jeet Jain. It currently claims to has an inventory of over 200 rooms in Bangalore in a short span of two months and planss to scale up to 5,000 rooms across 20 cities. The company partners with small, standalone hotels and helps them improve their service quality standards and also market themselves more effectively.
“Currently there are upwards of 10 lakh budget hotel rooms in India. But 95% of them are in the unorganized segment. Therefore, despite the availability of online booking options and third party reviews, the lack of quality assurance continues to be an unsolved problem for the traveller in this segment,” said Sidharth.
The news comes at a time when other players like Stayzilla, OYO Rooms, FabHotels, and Zen Rooms among others are also raising massive funding rounds. OYO Rooms raised a Series A funding of $25 million in March 2015 from Lightspeed Venture Partners, Sequoia Capital and Greenoaks Capital Management. Stayzilla secured a $20 million series B round of funding from Nexus Capital & existing investors Matrix Partners in February this year.
Budget accommodation startup, FabHotels, formerly Casa2Inns, raised $5 million from Accel Partners and Kalaari Capital. Accommodation startup Zen Rooms also raised funding from former Kingfisher Airlines chief executive Sanjay Aggarwal, earlier this month.