HYDERABAD, India, Dec. 1, 2021 - ISTHARA is a pioneering LivTech aggregation platform focussed on Shared living spaces, Smart food courts and Cafeterias, has raised a fresh round of capital amidst stellar growth in its portfolio of managed beds over the last twelve months, despite the pandemic impact. The latest fundraise will help the Company to capitalize on the growth momentum and further bolster its leadership position in the co-living and student housing sector in India.
The COVID-19 crisis dealt a severe blow to the co-living and student housing industry with reverse migration of workers and students alike. Existing operators were forced to relook at their business models, cut costs, downsize, or shut shop completely. ISTHARA on the other hand was able to successfully modify its business model. As a result, it continued with the pace of its growth through the pandemic. The Company increased its bed count by 3x, from ~5,700 at the end of Mar'20 to ~17,000 currently, across four cities: Hyderabad, Bengaluru, NCR and Chennai.
Supported by its technology backbone, ISTHARA also added a new business segment – smart food courts – under which it assumes the role of the technology partner and vendor aggregator to help large educational institutes and corporates to digitize their food courts / cafeterias for more efficient management. The segment has witnessed excellent traction since it was introduced in Feb'21, and the company has already signed up 50 food courts across Telangana, Karnataka and Tamil Nadu, catering to over 150,000 students. This tech driven vertical is asset-light, highly scalable, and has huge potential going forward even across smaller cities in India.
ISTHARA has grown in a highly capital-efficient manner with a strong focus on unit-level economics. This is particularly evident when benchmarking the Company against its key competitors. ISTHARA is promoted by serial entrepreneur Gilbert James who has extensive experience in operationally intensive businesses across hospitality and education through his previous ventures. The operations team is headed by hospitality veteran Vijayan Krishna Kumar who has deep domain expertise through more than two decades of global hospitality experience. Technology is headed by IT solutions expert Ligouri Godwin, and growth by serial entrepreneur Raamkumar. Under their guidance, ISTHARA has displayed both the agility of a startup and the providence of a large, established enterprise, enabling the Company to strengthen its position in a period of massive disruptions.
Despite short-term setbacks, the long-term prospects of the co-living and student housing industry have never looked better. The millennial story of convenience, cost-effectiveness, and community stays intact. The pandemic has caused people to lay greater importance on safety and hygiene, providing a strong fillip to an organized operator in the otherwise unorganized co-living industry. This is evidenced by the revival of investor interest in the sector, with three big ticket investments by marquee global investors over the last twelve months.
The latest round of investment in ISTHARA saw participation from JM Financial Private Equity, an existing investor, along with Dubai-based Eagle Proprietary Investments Limited and a few family offices. The Company has raised a total of USD 11 million of external capital .
Commenting on the fundraise, Gilbert James (MD, ISTHARA) said, "Challenges of COVID presented us with an opportunity to strengthen our core and prime the business for growth in a capital efficient manner. We are grateful for the confidence shown by our investors in the team and our future plans. We look forward to make a transformational impact on how young Indians live."
Commenting on the fundraise Darius Pandole (MD & CEO – PE & Equity AIFs, JM Financial) said: "The manner in which the ISTHARA management have responded to COVID-led disruptions is commendable. The Company has been able to meet its growth targets, and continue with the targeted operational improvements amid these tough times, which is an impressive feat. We have strong conviction in the sector story, and believe the COVID crisis will only expedite the shift from unorganized to organized co-living / student housing operators. We look forward to partnering with the new investors to help the Company achieve its growth objectives."
Speaking on behalf of Eagle Investments, Managing Director, Elias Kawar said, "We are proud to have partnered with JM Financial and ISTHARA's management team on this important transaction to support ISTHARA's ambitious growth plan and solidify their position in the Indian co-living and student housing sector. As our first private equity investment into India, this transaction underscores our confidence in the potential of the Indian market,s and emphasizes Eagle's investment approach of investing in strong management teams across sectors primed for growth."
SOURCE ISTHARA
