goStops is India’s largest chain of premium youth hostels. goStops was founded on 1st June 2013 by Ms. Pallavi Agrawal – Co-Founder & CEO and Pankaj Parwanda – Co-Founder & Director. These hostels are used as pit-stops for travellers. goStops curate experiences to enable travellers to explore the city in the best possible.
We are publishing an interview with Ms. Pallavi:
Q.: What is the problem you are trying to solve? Please share with us any insights that led you to believe that this is a big enough problem?
Ans: In the Indian short-stay accommodation market, there was a void in quality-assured stays in the budget of INR 400-800 per night range. Such accommodations were mostly poorly maintained and, were unpredictable in terms of quality and experience. In addition to this, there was no accommodation brand that was youth-friendly and exclusively catered to their needs and aspirations in terms of quality, design, experience or budget. This youth population is 370 million strong. It is growing fast and is very aspirational in terms of lifestyle. We saw a clear whitespace in the market. We spotted this problem and have been trying to solve this ever since the inception of goStops.
Q.: Tell us about the goStops. How did you decide on your first hostels’ base? Explain how you went with the process.
Ans: goStops (formerly Stops) opened its first hostel in Varanasi. Initially, the name of the brand was ‘Stops’. This name was chosen to represent the fact that our hostels serve as ‘pit-stops’ for travelers. However, in November 2017, after thorough market research and consumer profiling of our target audience, we made the decision to re-brand ourselves as ‘goStops’. Pre-fixing ‘go’ gave the brand name a younger and livelier feel and, it sounds more appealing to young Indians who ultimately are our target audience.
goStops is a chain of travelers’ hostels across India that provides social and experiential stays for young travelers. goStops started majorly with the intention of bringing the hostel-culture to India during a time when there were no hostels at all. There was an upsurge in young Indians starting to travel and, there was a market void for premium accommodations at affordable prices. Recognizing this void, goStops was born in Varanasi.
The major reason for choosing Varanasi to be the city to start a hostel was because of the fact that it is a popular destination among young people. It attracted both Indian as well as foreign travelers on a regular basis. Moreover, Varanasi is a cultural hub that portrays India in all in its pomp and grandeur! It seemed like the perfect place to kickstart goStops.
Q.: What is your USP? What is the insight that you have about this market, which no one else has? The uniqueness of your Startup.
Ans: goStops is a full-stack youth hostel company. We lease, manage, franchise real estate assets, which we design, transform, market, sell, and operate as youth hostels in locations where the youth travels for business or leisure. The youth population of India is an aspirational crowd that is very tech and social media savvy. Social media has exposed them to global cultures and lifestyles, and as a result, their lifestyle aspirations are also very high. They want a premium experience at an affordable price. This is the gap goStops is bridging for the youth. Our spaces are vibrant and colourful and, our services maintain a certain standard in terms of the quality (security, bedding, cleanliness, etc), and we are able to provide this within the budget range (INR 400-800) of the Indian urbanized youth. We enable young Indians to get a premium quality accommodation experience at an affordable price.
This insight that we have on the needs of our target audience is something that very significantly separates us from everyone else in the market. We centre all our products and services around this need; the desire for a premium quality product/experience at an affordable price.
Q.: What were your assumptions when you entered the market?
Ans: Our assumptions when we entered the market was that young travelers would love a youthful social accommodation over a boring privacy driven hotel. And thankfully, that assumption was tested true.
When we entered the market, most of our guests were foreign travellers. This was completely reasonable as a huge supply of travelers’ hostels already exist abroad, especially in Europe and South-East Asia. Travelers from these countries were already aware of the concept and were almost waiting for supply to come in and fill the gap. We then put some extra effort to market and introduce the concept to Indian travelers and, to warm them to stay at our hostels.Luckily, the Indian travelers loved and embraced the concept over all other forms of accommodation available to them.
Also, we were of the opinion that travelers’ hostels will chiefly cater to leisure travelers/backpackers whereas, to our surprise, we also started seeing a significant proportion of young business travelers amongst our guests in the cities. The latter segment has shown a steady year-on-year growth and this has been an interesting observation in the market.
We can now cater to a market that has nearly 370 million Indian youth aged between 18-35 travelling for leisure and work, and we’re really thrilled about the opportunities it presents to us.
Q.: What has been your biggest failure as an entrepreneur and what did you learn from it?
Ans: Our biggest failure was our initial inability to lay enough emphasis on branding/marketing. Because of this, we lost some mind-space in the initial years. As a result, we are currently investing fairly on our marketing division in creating a strong team of talented individuals who can push the brand forward.
Q.: How are you setting the pricing in goStops? What is the logic behind it? What is the model you are following – Free / Freemium / Premium etc. ? Explain your thought process.
Ans: Our pricing strategy always tries to maintain a balance between customer needs and market demands. Our primary motive is to make a premium hostel experience available to young Indians at an affordable price. So our pricing can be categorized as, “massy premium”.
Q.: Please tell us about the investors (if any)?
Ans: We have recently raised an angel funding round from eminent Angel investors. The round saw participation from investors like Mr. Nitish Mittersain (Founder and MD of Nazara Games), Mr. Sorabh Agarwal (Ex-MD at Copal Partners), Mr. Sameer Walia (Founder and ex-MD at The Smart Cube),Mr. Rohit Shankar (Co-Founder of Dimdim.com), Mr. Sunil Kumar Singhvi (Owner at South Handlooms) and other senior corporate executives.
Q.: Is there any interesting success story of your startup?
Ans: Our ability to run goStops profitably as a bootstrapped organization for 5 years is the most interesting success story for us. These 5 years taught us how to run a business effectively, without needing any external sources of funding and, made us into thoughtful and mindful investors of our limited funds.
Q.: What is the big picture of your startup? Is this service leading to something bigger? If so, how?
Ans: We want to be the preferred Youth Brand synonymous with great quality travel and living spaces.
Q.: Who do You Perceive Your Competition? How do you differentiate yourself from them?
Ans: We don’t see anyone as our direct competitor as our business model is quite unique. goStops is a full-stack youth hostel company. We lease, manage, franchise real estate assets, which we design, transform, market, sell, and operate as youth hostels in locations where the youth travels for business or leisure.
Q.: What would be your goal to accomplish in the next six months? Any other information you would like to share?
Ans: We are planning to expand our presence across the country by doubling our bed capacity within the next 12 months. We also plan to utilize recently raised funds to enhance our product offerings through investments in technology & training, add new revenue streams, strengthen our marketing and build a team to handle the next phase of growth.
Q.: What message do you want to convey to fellow entrepreneurs?
Ans: Strive on, diligently. Consistent focus and dedication can overpower everything else.
Thanks Pallavi. Best wishes.