BANGALORE -- India's flat-share platform, Zolostays, is in talks with Swiss investment bank Credit Suisse to raise around $100 million, according to a report by Press Trust of India.
"We are in talks with Credit Suisse to raise $100 million in a Series C round to fund our expansion plans to increase the number of beds to 200,000 by the end of 2021 and we also plan to increase our headcount," Zolostays co-founder and CEO Nikhil Sikri was quoted by PTI as saying.
In January, the five-year-old company raised $30 million in a Series B funding round led by IDFC Alternatives, Mirae Asset and Nexus Venture Partners.
The Bengaluru-based company already has 35,000 beds in Bengaluru, Chennai, Kota, Gurugram, Hyderabad, Pune, Mumbai, Noida and Coimbatore. Of those, it had dedicated 3,000 beds for students. PTI quoted Sikri as saying that 15,000 beds are under development in those cities and will be available before March.
Zolostays has partnered with established real estate developers like Godrej Properties, Shapoorji Pallonji Real Estate, Sobha Developers, Olympia Group, DRA and Ozone Group.
"We either lease out an entire building from the developer or share the upside with them. Given the current slowdown in the realty sector, many developers are looking to partner with people like us as they are assured of good returns," PTI quoted Sikri as saying.
The co-living market in India is set to grow at a compound annual growth rate of 17% in the next five years to reach a market size of nearly $14 billion, according to a joint report by the Federation of Indian Chambers of Commerce and Industry and American commercial real estate services company Jones Lang LaSalle.
The report said that demand for co-living is strong from students and young adults moving to cities for study and work.
Besides Zolostays, flat-share startups in India such as NestAway and CoLive, which owns 20,000 beds, are also becoming popular. The four-year-old NestAway has expanded to more than 10 cities in India. In September, it raised $4.8 million in a Series D round from Goldman Sachs.
Last year, hotel chain Lemon Tree and private equity firm Warburg Pincus signed a joint venture to invest $15 billion in the Indian co-living space.
KrASIA is a digital media company focused on technology-driven businesses and trends across the Asia-Pacific region. It is part of 36Kr, a tech news portal based in Beijing. Nikkei has a minority stake in 36Kr.