3737 North Capital LLC has made its second bet in a Pune-based tech-backed data-driven backpacking hostel chain, a top executive of the India- and US-based investment advisory firm told VCCircle.
The investment advisory firm has invested $1.4 million in Backpacker Panda Holidays Pvt. Ltd in the company’s Series A round of funding, said Bhavish Sood, general partner at North Capital.
It has committed to invest $1 million more in the firm’s Series B subject to the company achieving additional business milestones, he said.
The investment was done through its Exponential Innovation Fund-I, which is registered with market regulator the Securities and Exchange Board of India (SEBI) under the AIF Category I.
Backpacker Panda will use the funds to enhance customer experience, build its brand, strengthen its tech team and expand its footprint in domestic and international markets. As part of the transaction, the fund‘s CIO Manpreet Mattu will join the board of directors and Sood will join as a board observer.
The company was founded by Kumar Vivek and Vivek Jain in 2015 with the aim of making travelling easier and more accessible. With its recently launched flagship property at Colaba in Mumbai, the company provides 14 properties across India.
The backpacking hostel space has seen some investor interest in the past years. In 2016, Goa-based startup Roadhouse Hostels Pvt. Ltd, which runs a chain of hostels targetted at backpackers, had raised an undisclosed amount of investment from Indian Angel Network (IAN).
Another player in the space, Zostel Hospitality Pvt. Ltd, which had raised angel funding in 2014, was acquired by budget hotel aggregator OYO Rooms in 2016.
Exponential Innovation Fund-I seeks to invest in fintech, health tech, enterprise software and edtech. It will also opportunistically invest in agritech and cleantech and will primarily focus on business-to-business businesses, Sood had told VCCircle last year.
The venture capital fund‘s first investment was in Revvlocity which operates in the inside sales space.