Mumbai-based co-living space provider Zolo has raised $30 million (Rs 208 crore) in a Series B round of funding led by private equity firm IDFC Alternatives, South Korea's Mirae Asset and existing investor Nexus Venture Partners.
Zolo will primarily use the funds to accelerate its aggressive expansion drive and to invest in the student accommodation segment, the company said in a statement. The startup will also use the fresh capital to bolster its technology division.
Owned and operated by Zolo Stays Property Solutions Pvt. Ltd, the startup offers fully managed, ready-to-move affordable rooms and apartments to young working professionals and students. Users can make a booking either via its mobile app or website.
Zolo was founded in September 2015 by Nikhil Sikri, an alumnus of the All India Institute of Medical Sciences and Indian School of Business, and Akhil Sikri, a computer science graduate from IIT Delhi.
“Co-living spaces offer immense potential as a market in India, something that we at Zolo identified and tapped into, early, with Zolo being the first full-stack player to enter this business in 2016,” Sikri said.
Sikri claimed Zolo is the largest co-living player in the country. "With this fresh round of funding, we plan to continue our lead as the biggest co-living brand and keep raising the bar for customer service," he added.
Since the Series A round, the company claims to have grown from 2,000 live beds to 16,000 live beds with 157 properties under management. Zolo is targeting 50,000 beds by the end of this year.
“Zolo is addressing a large and real problem of providing quality affordable living solutions for young professionals in urban India,” said Ashish Dave, head venture investments at Mirae Asset Global Investments (India).
Zolo is present in six cities: Bengaluru, Chennai, Kota, Delhi NCR, Hyderabad and Pune.
IndigoEdge was the exclusive banker for the transaction.
As the concept of co-living is gaining mainstream acceptance in the country, the venture capital deal flow has picked pace in this segment in recent years.
Private equity firm Warburg Pincus is setting up a joint venture with Lemon Tree Hotels Ltd that plans to invest as much as Rs 3,000 crore ($426 million) to develop full-service accommodation for students and young working professionals.
Warburg Pincus will hold a 68% stake in the joint venture while Lemon Tree will own 30%, the hospitality company said last month. The remaining 2% will be held by Lemon Tree chairman Patanjali Keswani.
In September last year, Delhi-based student accommodation platform Stanza Living raised Rs 73 crore ($10 million) in a fresh round led by venture capital firm Sequoia Capital.
In August, Housing Development Finance Corporation agreed to pick up a 25% stake in Good Host Spaces Pvt. Ltd, which offers student housing facilities under the brand name NewDoor (previously Yoho), for Rs 69.5 crore (a little less than $10 million).
In July, Bengaluru-based co-living space provider StayAbode raised an undisclosed amount of funding in a pre-Series A round of funding from Anupam Mittal, CEO at People Group; Japanese gaming company Akatsuki Inc. and Vineet Sekhsaria, head of real estate investing at investment bank Morgan Stanley.
In February, Noida-based Placio, which operates an eponymous student housing solutions platform, secured $2 million in a pre-Series A round from Singapore-based private equity fund Prestellar Ventures.