RoomTonite, a last minute hotel booking service provider, has announced raising of $1.5 million in a seed funding round from a group of angel investors, including Nikhil Vora (founder of Sixth Sense Ventures), Lashit Sanghvi (co-founder of Alchemy Capital), among few more.
Other investors who participated in this round include Venkat Vardhan (promoter of DNA Networks), Mohammed Bin Abdul Rehman Al Khalifa (Chairman of Caravan Group), Ralph Berezan (Berezan Group) and Vissal Mathew and Balamurali Krishna (IDS Software).
To fuel further expansion, RoomsTonite is also in talks with a few institutional investors and is looking to raise $7 million to $10 million in a Series A round of funding.
With this funding, the Bangalore-based company is now looking to expand its hotels base and improve the overall technology infrastructure of the platform. Customer service improvement is also a priority.
Founded by Suresh John in 2014, RoomsTonite enables users to book hotel rooms at last-minute at a discounted rate. It mobile application allows users to book room from 1 day to up to 3 days.
The company claims to have partnered with around 4,000 hotel from across 325 locations all over the country. By mid-2016, the company is planning to increase the number of hotels to around 10,000.
Although the company was founded in 2014, its Android mobile app went live in January this year and the iOS app went live in April. It claims to have witnessed over 2,00,000 downloads so far.
As for revenues, the company takes a commission of about 15-18 percent on every booking from takes place through its mobile application.
It lists budget, premium, comfort and luxury hotels along with home stays and vacation homes. It partnered with Tripvilla to foray into home stays and vacation homes.
The partnership with Tripvilla, which offers vacation rental homes, enabled RoomsTonite to expand its operation to international markets such as Singapore, Bali, Thailand, Sri Lanka, among others. It is planning to enter into West Asian markets shortly.
Suresh John, founder and CEO of RoomsTonite, said,
The big pain point most hotels face is to sell their unsold rooms. The average occupancy rate across hotels in the country is somewhere between 50 per cent and 60 per cent. We look to access and distribute the 40 per cent of unsold rooms to help hotels find an additional revenue source while offering customers a great deal in last-minute bookings.
The company directly competes with NightStay, a last minute hotel booking service provider which has recently raised $500K in seed funding.