What it took for AxisRooms to raise a round of funding ...
It seems to be the time for aggregation services, as Bangalore-based hotel, AxisRooms, recently announced an investment from Seedfund (the investment firm behind redBus, another aggregation service). Founder, Anil Kumar Prasanna, comes with relevant experience in the online travel booking space through his work at online travel agents like ClearTrip.
The company at present offers three key products - Channel Manager, Booking Engine and Corporate and SME Tools. The Channel Manager provides a single platform for hotels to manage inventory and pricing with all online travel portals. The platform also helps hotels to increase their distribution and revenue. The Booking Engine on the other hand allows hotels to take direct bookings through their own website. Corporate and SME tool empowers the employees of a company to manage their own bookings, within the defined parameters of the firm, thereby reducing the need for an extra resource for managing the bookings. It generates revenue by payment based on transaction fees and subscription fees and this makes it easy to adopt the technology for all types of hotels from stand alone home stays to multi-hotel chains.
Anil shared that the idea of AxisRooms was germinated back in 2009, but came to fruition 2 years later in February 2011. Since then, Anil has faced an uphill challenge, in trying to bring traction to the site and growing it to a level when investors began finding the venture interesting. He says, “In fact, so many people said it wouldn't work. If you look at the hotel bookings with OTAs today, about 12 – 15 % of their inventory is available for online booking. I've seen this. The rest of the rooms are actually allotted for other sources like travel agents and walk ins.” However, he believes that there is a lot of scope for development. Anil says, “In markets like the US, over 50% bookings are done online, and we believe that it is the case in India as well.”
Funding doesn’t come easy, and Anil is all but aware about it. He says, “Oh, the journey has been long and hard. We were bootstrapped, and we put in all our savings into the project. We even put money from our families and friends as well. And after all this, people coming and telling us that it won’t work, really didn’t help. And then there were hotels which were using their own systems. But they were terminal based and obsolete and we knew that we could definitely add value to this existing system.”
And so, they persisted, amid speculation, and tight budgets. Slowly, but surely, the value they were offering began to trickle down to their users. Anil vividly remembers how a hotelier in Hampi began to see almost a 90% online booking rate after he implemented the AxisRooms widget on his site. He says, “I think close to a year into the business, people hoteliers began to see the value in the product that we were offering. They saw that it was an important solution, and from then on, we’ve been getting steady increase in the usage of the product.” Today, AxisRooms sees as many as 5000 transactions a month, averaging 200 transactions a day on their site and has 265 hotels registered on its platform.
The traction gained investor interest as well, and Anil recalls that he met Sanjay Anandaram, Partner at Seedfund, at a YourStory event, where they had a short introduction, post which they interacted a over email, which eventually led to the funding. The details on the amount, stake and the partner on board the company isn’t clear yet.
With this investment, Anil shared that they will aim to scale the product, both in terms of adding new features and functionalities and getting more traction to the site. Today, AxisRooms see about 400 hotel room requests every day for the 265 hotels on its platform. He says, “As a part of enhancing the product, we’ll be aiming to cater for the ecommerce industry as well. If you’ve noticed, Groupon is selling hotel inventory on their site. It might become a trend in the coming days.”
Anil is aiming for inventory from 5000 hotel rooms by 2015, but on a broader level, his aim for AxisRooms is - “A single point distribution platform for all hotels in India.”
Come to TechSparks; what happened to Anil might happen to you as well!