India-based hotel reservation provider Stayzilla has raised its first institutional funding round from Matrix Partners India by offering a significant minority stake. The investment amount was not disclosed.
Last year, the company raised $500,000 angel funding from Indian Angel Network (IAN), the biggest business angel investor group in Asia with 250 business angels.
In addition to providing accommodation options in tier one cities in India, Stayzilla mainly focuses on accommodation options in tier two and tier three cities.
Currently, the website lists about 6,300+ hotels from 750 cities across India. In comparison, MakeMyTrip, India's biggest OTA has 10,000 domestic hotels in its inventory.
The new fund will be used to expand the team, increase the hotel network to 15,000+ hotels and improve customer service operations.
Yogi Vasupal, co–founder and CEO of Stayzilla says:
“The online hotel booking industry has been at a nascent stage for the last few years. It is now at an inflection point and I expect 40% of all hotel bookings in India to be done online within the next 5 years. We are confident that with IAN and Matrix, we have a winning combination of investors and guides.”
Avnish Bajaj, co-founder and managing director at Matrix India says:
“Stayzilla operates at the intersection of two important trends – increasing penetration of hotel bookings online by consumers and increasing number of hotels from Tier 2/3 cities coming online.”
Bajaj's trend analysis is in line with a recent study conducted by MakeMyTrip where 97% of the respondents wanted to book their hotels online in India.
Stayzilla doesn't want to diversify its business focus, rather it wants to only focus on online hotel booking market in India.
NB: Coins image via Shutterstock.