We are perhaps at the behest of seeing an e-commerce like war in India’s exciting budget hotel offering segment as well. And to fuel that battle and take on its rival Oyo Rooms, Zo Rooms has raised $30 Million in fresh round from Tiger Global, just days after Oyo refreshed its war chest with a $100 Million from Softbank and others.
This round becomes all the more interesting, as it comes just 2 weeks after Zo Rooms raised a $15 Million Series A round from Tiger Global and others, making it one of the fastest Series A to Series B fund raise.
While Zo Rooms hasn’t confirmed the round per say (we’ve asked for a confirmation and will update the story once we get an update), two people with direct knowledge of the current round have divulged a few details to Economic Times.
This fresh capital will be used for an aggressive expansion into other Indian cities.
Sources, on the condition of anonymity, further told ET,
They (ZO Rooms) are addressing a big gap in the market, and have managed to scale very rapidly. But there is competition, and every company needs capital to counter that, while continuing to grow at a certain pace.
And this fund-raising spree for Zostel Hospitality (Zo Rooms and Zostel parent) isn’t stopping just yet. Sources have further told ET, that the company is already in talks with Fidelity Investments, one of their existing investors, for a further round.
ZO Rooms is currently present in 35 cities across the country, and has about 500 hotels listed on its marketplace. However, unlike its rival Oyo, Zo Rooms targets customers within the Leisure and Business category.
We’ll update this article with more information, once we receive a response from either of the companies involved.
As for the remaining two parts of this battle, here are the links :
Part I : Budget Hotel Chain Zo Rooms Raises Series A Round From Tiger Global And Orios Venture Partners
Part II : Oyo Rooms Grabs $100 Million In Fresh Round Led By SoftBank