Co-living and food court operator Isthara has raised $10 million from investors to expand its business, its MD Gilbert James said.
Isthara, which was founded in 2017, raised funding from investors led by Dubai-based Eagle Investments.
It has so far raised $21 million, including this fresh round of funding.
Coimbatore-based Isthara currently has a capacity of around 25,000 beds, catering to working professionals and students, across seven cities.
"We have raised $10 million as growth capital. The amount will be used to expand our co-living and smart food court businesses," James told PTI.
James, who is also promoter, said the company will enter into retail food court space.
Expansion plans
In the next three years, he said the company is targeting to reach 50,000 beds and 500 food courts with the help of this current round of fund raise.
“The expansion will happen in three formats: existing food courts in shopping malls, high-traffic retail/high-street locations, and highways. Around 30 retail locations are in the works and will be operational within the next six months “ said James. In the institutional smart food court space, the company currently operates 35 food courts, while 15 are in the B2C segment.
According to James, the smart food court segment is mostly unorganized. “There is some activity here and there in terms of some people trying to bring in tech-enabled corporate dine-in options, but it’s a fairly open market. We aim to bring a variety of choices for consumers at the dine-in level,” he added.
Additionally, the funding will also be utilized to double bed capacity in the co-living and student accommodation segments to 50,000 beds by 2025. “We want to penetrate deeper into the existing markets in our co-living business,” said James.
“With a rise in safety and hygiene concerns since the pandemic, we are seeing a fundamental shift as customers across the spectrum are increasingly opting for tech-enabled and safety-focused co-living and food options. We are excited to support the company’s next growth phase as it continues to make new strides in the liv-tech segment,” said Elias Kawar, MD, Eagle Investments.
Profits
James added that the monthly run rate has doubled in the last year.
"We are profitable at the unit level in both businesses. We are yet to be profitable at the corporate level, as we continue to invest in technology and growth," he said.
Isthara aims to become the market leader in the food court business, where it acts as an aggregator and brings established and new brands to one platform.
With the company's foray into the B2C food retail segment, James said the company would be able to widen the customer base and not be limited by a captive audience as is the case with institutional cafeterias.