The Hosteller: From humble beginnings to India’s largest backpacker hostel chain

This Indian backpacker hostel chain is redefining hospitality, one traveller at a time

   
The Hosteller From humble beginnings to India's largest backpacker hostel chain

Although backpacking is not a novel phenomenon, it has currently become a new craze among Indians.

Fun fact: Did you know, about 45 million backpacking trips are taken annually, two-thirds of which are by 20–25-year-olds! The most popular reason to go backpacking is to experience new cultures. These travellers (80 per cent) like to stay in hostels and one third of them rely on reviews for hostel bookings.

Thailand and Vietnam have the most hostels in the world. However, one Indian brand is aiming to foster the same culture here.

Founded in 2014 by Pranav Dangi, The Hosteller has quickly emerged as a leading provider of affordable, comfortable, and culturally enriching accommodations across India. “The Hosteller has welcomed over 600,000 travellers, providing them with memorable stays, cultural exchanges, and the warmth of a home away from home,” says Pranav Dangi, Founder and CEO of the backpacker hostel.

Journey of growth and exploration

Speaking to SME Futures, Dangi talks about his journey which began with a simple yet powerful idea—to provide budget travellers with affordable, comfortable, and culturally immersive accommodations across India. With this vision in mind, he set out to establish The Hosteller, laying the foundation for what would become India’s largest brand-operated chain of backpacker hostels.

He recounts The Hosteller’s launch, tracing its roots back to a single location in Delhi. He reflects, “From our humble beginnings to becoming India’s largest brand-operated chain of backpacker hostels, our journey has been filled with tales of community, a strategic growth vision and a love for all things travel.”

What started as a modest venture has now burgeoned into a network of over 55 backpacker hostels across India. “The Hosteller has hostels in cities like Delhi and Bangalore as well as in offbeat and lesser explored villages like Jeolikote and Tirthan Valley.” This remarkable growth underscores Hosteller’s commitment to providing unparalleled experiences to travellers, fostering cultural exchanges, and creating a home away from home for globetrotters.

“This expansion has not only increased our footprint but has also diversified our offerings, catering to a multitude of travel amenities that now include in-hostel events, a web concierge app, a local activities section, a membership programme, a loyalty programme, a rich invest & partner programme and much else,” he enthuses.

Currently, the company has three primary revenue sources—accommodation, F&B and concierge. “We’re currently present in 10 states in the country with 2000+ rooms spread across 55 destinations. Also, from just a of handful people, our team has grown to a family of over 500 employees (GO and HO combined), each contributing to the brand’s ethos of dynamic and interactive hospitality,” he adds. 

Success strategies in competitive landscape

Initially, Dangi’s venture had a difficult time raising funds. He reminisces, “It was difficult in the beginning. Our primary sources of funding were friends and family. Then came angel investors who believed in us, and the promoters who funded us.”

Though the hostel market is niche in India, it is becoming competitive with the trend skyrocketing. According to an article published on LinkedIn, the Indian travel hostel market is poised for significant expansion by the year-end. According to estimates, the market’s income will increase by 40 per cent, hitting Rs 2,500 crores by the end of the fiscal year. Which is huge. Despite this number, there are few players in India catering to this arena. And that also means it’s the right time to get into the intricacies of this business.

“Our competitors currently are-Zostel, Gostops or the likes of Bloom rooms,” says Dangi. He elaborates on Hosteller’s strategic measures that have brought it to the forefront of the Indian hostel business. It includes tapping into regional markets, cultural growth and expansion, local collaborations, and a commitment to building a community and providing social engagement. Its strategic ‘hub and spoke’ expansion plan has positioned the brand to attract a wider customer base.

“By strategically opening new hostels in diverse locations, we tap into regional markets, appealing to a broader range of travellers. This expansion enhances our brand visibility and solidifies our reputation. Also, each new location, with its unique cultural and environmental setting, allows us to offer varied experiences to its guests. Expanding into regional areas creates opportunities for local collaborations and community engagement, strengthening the brand’s ties with different regions. It also allows us to adapt and innovate based on different market needs and trends, keeping the brand dynamic and relevant,” he asserts.

Adapting to changing dynamics and future roadmap

Additionally, recognising the diverse needs of travellers, the company has spearheaded initiatives to offer personalised experiences by organising social events, local tours, and interactive activities.

By leveraging technology for seamless experiences and investing in employee training, The Hosteller sets itself apart from the competition. “We provide contactless check in and check out, hands free (Alexa) controlled rooms in several locations, an in-house tracking mechanism to gauge campaigns and have a fully functional web concierge app, Glu. Glu is our online concierge service, which is only available for The Hosteller guests,” he elaborates.

As work culture undergoes a transformation with the rise of remote work, The Hosteller has adapted by offering tailored workcation products and dedicated workspaces at its hostels. “This is for long term stayers. We have provided workspaces at each hostel with stable Wi-Fi, private meeting pods, etc.,” Dangi says. Moreover, the brand remains committed to supporting local communities and promoting cultural exchange through unique experiences and partnerships.

Looking ahead, The Hosteller has set ambitious expansion goals, aiming to add 75 new hostels in 2024 and a further 100 in 2025, solidifying its position as Asia’s largest backpacker hostel chain. Grounded in values of transparency, exceptional service delivery, and building for the future, The Hosteller continues to redefine the hospitality landscape, one traveller at a time.

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