Hostels

With demand for backpacker hostels growing, how goSTOPS entrepreneur Pallavi Agarwal is positive amid

Since launching its first hostel in Varanasi in 2014, GoStops expanded its presence to 27 different locations in India and welcomed over 4,00,000 travelers across our 28 properties.

An intrepid traveler throughout her life, Pallavi Agarwal first experienced the life of a backpacker during a trip to Europe in 2012.

“It was not long after the trip that I realized there was a clear need for social friendly accommodation to meet the aspirations of India’s huge youth population, which led me to my journey as an entrepreneur,” she says of the pain point behind the business.

Riding the wave of startups, Pallavi, founder and CEO of goSTOPS, has made a foray into a not-so-established segment of the hospitality industry using the backpacker hostel model.

“The young Indian traveler deserves the best accommodation experience wherever they go, without having to strain their budget. The introduction of the concept of backpacker hostels in India meant that the young people of the country would have access to quality accommodation high brand quality that until now have been beyond the reach of Gen-Z.Our unique strategy is focused on Millennials and Gen Z who are uninhibited to try new experiences, who are free to spirit and yet demanding at the same time,” she explains.

Rising demand

The pandemic and the ensuing “new normal” have led to a significant shift in consumer behavior, spawning new travel trends and practices. As the hospitality industry returns to normal, Pallavi says we will see a huge pent-up demand for travel.

“What we are seeing today is growing demand for backpacker hostels with bookings up 110% since August 2021. We are also seeing an increasing number of bookings from solo travelers over the past few months, with individuals tired of the monotony of staying at home and looking for some well-deserved time for myself, preferring to travel alone. Also, the trend at work has skyrocketed over the past few months,” she says.

Taking advantage of these new trends and expectations, goSTOPS has pivoted differently – expanding to new “stunning” locations in India and recently added new goSTOPS stays in Kerala, Goa and prime locations in Uttarakhand such as Rishikesh Lakshman Jhula, Mussoorie, Kasar Devi, Mukteshwar and Nainital.

Pallavi reveals that compared to last year, his ARR has increased sixfold.

“We grew from 700 beds in 2019 to 2,000 beds in October 2021, recording a threefold increase in size after leveraging the availability of good quality hotels to our advantage. While demand has increased proportionately, we are confident that RevPAB, (Revenue per Available Bed), will soon exceed pre-COVID times. We have already tripled absolute numbers and based on recent booking trends, our RevPAB is already exceeding October 2019 numbers. almost 1,000%, especially in destinations located a few minutes by car from metros and mini-metros. »

The Diwali holiday season has also seen a 50-60% increase in daily bookings. Due to increasing traveler preference and booking demands for offbeat leisure destinations, goSTOPS destinations such as Jaipur, Udaipur, Pushkar and business cities like Mumbai, Amritsar and Delhi have performed extremely well.

Pallavi Agarwal

Experiences to attract new travelers

In a bid to create an ecosystem for young backpackers across the country, the company has also integrated EaseMyTrip in addition to the online travel aggregators (OTAs) already available.

“Recently, we also launched our Community Management and Volunteer Program to bridge the gap between goSTOPS and its community. This program aims to provide a comprehensive experience for young, passionate and responsible travel enthusiasts and volunteers to run and manage a hostel and create the most engaging, interactive and memorable experiences for guests staying at all goSTOPS properties,” Pallavi adds.

goSTOPS offers accommodation options in well-equipped social dormitories with 8/6/4 AC beds as well as youth private rooms with a minimalist design. In total, 70% of goSTOPS inventory consists of dorms and 30% private rooms.

Each hostel has indoor and outdoor common areas with facilities for entertaining, working, socializing with other travellers, playing or just relaxing. It also has a 24/7 cafe with a centralized food offering for a standardized dining experience for its younger guests.

Its recently launched goEXPERIENCES, a new vertical focused on Gen Z and Millennials, offers an array of exciting experiences and adventures across various popular destinations in India. The experiences are curated by the trekking and travel experts of goSTOPS, while offering live booking and distributing them across all channels – website, app, IVR, OTA.

“We also offer ‘work away from home’ packages which provide the ideal post-lockdown work and living spaces for young travelers and come with all sorts of perks such as high-speed Wi-Fi, dedicated work, recreational activities, good cleaning and disinfection practices to ensure travelers have a safe and healthy stay. We also offer ‘group booking’ options for young backpackers traveling with a group of friends and looking for friendly shared spaces and accommodations,” she says.

Towards aggressive growth

On the other side, goSTOPS helps hotel or guesthouse owners on a budget to generate higher income by renting and renovating their properties and converting them into exciting goSTOPS hostel accommodation and providing them with end-to-end professionally managed operations, information-driven design intelligence, professional sales, marketing and distribution support, and deployment of best-in-class technology.

Zostel and The hostel are its main competitors as well as collaborators in the hostel space.

In 2020-2021, goSTOPS raised a funding round led by 1Crowd Fund and angel investors, including Nitish Mittersain, the founder of Nazara Games. Recently, it raised $1 million in a pre-Series A round led by Indian Angel Network and Yuj Ventures, the private investment arm of the family office of Xander Group founder Sid Yog.

The round also saw participation from Chennai Angels, Chandigarh Angels, Lead Angels, Mumbai Angels Network, LetsVenture as well as existing goSTOPS lead investor 1Crowd. KRS Jamwal, Uday Chatterjee and Mitesh Shah led IAN this round.

According to Pallavi, the freshly infused funds will be used to grow the goSTOPS offering over the next 12 months – to invest in marketing, acquire cutting-edge technology and build the team. The company also aims to raise $10-12 million by March 2022 and achieve revenue of Rs 1,500 crore by 2027 from its standing figures of Rs 12 crore per year.

Pallavi wants to move forward with a positive outlook even though being part of the shared economy segment, hostels have been the hardest hit by the pandemic.

“We plan to add 60 hostels to our current range of 28 by March 2022. By 2027, our target is to add 75,000 beds and generate revenue of approximately Rs 1,500 crore. We aim to raise $10-12 million by March 2022 and by 2024 we are all set to expand to exotic international destinations in Sri Lanka, Nepal and Southeast Asia,” says- she.