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Goldman Sachs leads new funding round in budget stays aggregator FabHotels
![Goldman Sachs leads new funding round in budget stays aggregator FabHotels](https://assets.techcircle.in/uploads/article-image/2019/06/images/18832-travel-1677347-960-720.jpg)
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Gurugram-based Casa2 Stays Pvt. Ltd, which owns and operates budget hotel aggregator FabHotels, has received $7.86 million (Rs 54.3 crore at current exchange rate) in a fresh tranche of funding.
According to the company’s filings with the Registrar of Companies, existing backer Goldman Sachs has led the tranche with a $5.04 million (Rs 34.8 crore) infusion.
Existing backers Accel and Qualcomm Ventures accounted for the rest. The company raised this sum late last month by issuing Series B class of compulsorily convertible preferential shares.
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The company raised this tranche at a $900-910 million (Rs 6,221-6,290 crore) valuation, by TechCircle estimates.
TechCircle could not ascertain if the infusion was part of the $25 million Series B round the firm had announced in July 2017 involving Goldman, Accel and Qualcomm.
E-mail queries to Vaibhav Aggarwal and Adarsh Manpuria, co-founders of FabHotels, did not get a response till press time.
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The Financial Express, citing a spokesperson, said that the funding was part of the announced 2017 Series B round.
The filings also revealed that FabHotels may also be looking to raise at least another $15 million as part of a fresh funding round from a new investor.
FabHotels was founded in 2014. Aggarwal had previously co-founded Rocket Internet-backed online furniture e-tailer FabFurnish. He also had stints at Groupon and Bain & Company. Manpuria had served as venture development associate at Rocket Internet Ventures and had closely worked with many of its portfolio companies, including FabFurnish, Foodpanda and Jabong.
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FabHotels works on an asset-light model, where it uses the technology platform to promote its partner hotels with capacities of 20-40 rooms, and provides standardised services to budget travellers. It also operates a professional training academy for the hotel staff and quality control teams.
FabHotels operates over 500 hotels across more than 40 major Indian regions, including Mumbai, Delhi-NCR, and Bengaluru.
Players like FabHotels are currently facing stiff competition from deep-pocketed and better-established players like OYO, MakeMyTrip and Yatra, which are seen as the current market leaders in the hotel-accommodation space. Besides, global players like Airbnb, Booking.com and Agoda have also set up shop in India and are looking to expand their operations through strategic investments or tie-ups.
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Last month, media reports stated that Treebo Hotels, another well-funded player in the space, was in advanced talks to raise up to $40 million from French hospitality chain Accor SA in a fresh round of funding.
There were also speculation of a possible consolidation between Treebo and FabHotels.