On India’s most bustling city hubs, there exists a pearl for travellers who seek a middle ground of luxury and affordability – FabHotels. Furthermore, with a changing urban environment, the need for user-friendly but reasonable lodging is at a zenith. Against this backdrop, FabHotels stands out as an early mover in this area, radically pursuing a different and less expensive hospitality experience for economically minded travellers.
Source: Makemytrip
Company Highlights
| Attribute | Details |
| Startup Name | FABHOTELS |
| Headquarters | Gurgaon, Haryana, India |
| Sector | Hospitality |
| Founder | Vaibhav Aggarwal and Adarssh Mnpuria |
| Founded | 2014 |
| Website | fabhotels.com |
FabHotels: Overview
FabHotels is a brand that is hugely respected within the industry for providing basic but cheap hotels with franchise systems. Once its franchises are open, FabHotels maintains close tabs on both the upkeep and operational standards to ensure that its hotels serve for the purpose of offering an elite combination of comfort, space, and cost-effectiveness.
It’s the moment Hotel is acclaimed as the Frankees partner brand, that it is up to the brand to bring the facility up to standards. As a provider of workers training in addition to technical support, FabHotels offers partner hotels that have technologically advanced support management systems. Further, a regularly scheduled corporate-wide audits at franchise are implemented in order to facilitate a sustained high standard of service, which will in turn guarantee the permanent excellent customer experience.
FabHotels : The industry
The Indian hospitality industry‘s remarkable compound annual growth rate (CAGR) growth from USD 24.61 billion in 2024 to USD 31.01 million by 2029 is predicted to be around 4.73%, according to Mordor Intelligence’s research analysis.
There are 3 critical reasons for the visible upturn in tourism that are foreign travellers increasing, the middle class expanding, and the improvements in travel experiences.
FabHotels: Shareholding
| Shareholding | Percentage |
| Fund | 69.5% |
| Founders | 24.9% |
| Angel Investors | 3.9% |
| ESOP (Employee Stock Ownership Plan) | 1.7% |
FabHotels : Startup Story
Source: ET Hospitality
Mr. Vaibhav Aggarwal, the co-founder of FabFurnish.com, was among the alumni to launch a business upon graduating from Wharton in 2012. But it was in April 2014 that Aditya and Adarssh realized it was time to move on to the next level and they established FabHotels taking advantage of warehouses near airports and rail stations, and which were used by these transport hubs as their booking offices.
The company’s core mission was to deliver budget-friendly housing solutions that were tailored to fit the travelers’ space requirements of companies. This is what initially attracted people’s attention – FabHotels had a light-asset business model and its determination to achieve perfection. The example of this remarkable achievement demonstrates that new concepts, creative efforts, and entrepreneurship are capable of producing the right consumer preferences and demand scenarios.
FabHotels -Mission And Vision
Mission:
The FabHotels mission is to always provide great and price-friendly service for its guests. They have a burning urge to provide our guests with the best experience regarding service quality, fulfilling their need of comfort and happiness during the length of their stay.
Vision:
The FabHotels provides a way to announce FabHotels as being no. 1 value-for-money brand in the hospitality industry of India through their company’s website. This is the idea they lie onto–travelers of all walks of life, be it business, family or leisure, deserve above average accommodations at affordable prices. Thus, by introducing new concepts and by fostering play, we become modules of the standardization in the hospitality industry, enriching the travel journeys of our guests all over the country.
Fabhotels : Products and Services
Ensuring a Safe Stay: FabHotel’s Guests Deserve and Get the Security Fight They Deserve
In May 2020, FabHotels had a radical initiative to keep anyone staying at their Hotel safe and healthy. ‘100% Safe Place to Stay’ strategy was developed, and a series of robust security measures were executed across the brand’s network of 600+ franchise units spread out across India.
The implementation of a Refer and Earn Program will allow our business to expand.
Managed to start an ‘unearth’ initiative on September 27, 2018 and since then the ‘Refer-and-Earn’ system is working. This plan is based on the premise that our loyal customers can now invite their friends and families to sign-up and utilize a personalized referral link to book their perfect short-term accommodation through FabHotels.
FabHotels : Business Model
FabHotels adopts an asset-light business model, engaging with small hotels via a franchising framework to facilitate rapid expansion without substantial capital outlay. Ensuring uniformity across partner establishments, the emphasis is placed on maintaining high standards of hygiene and essential amenities.
Strategically targeting corporate clientele, FabHotels secures business reservations through a dedicated enterprise sales team. Tailored to meet the needs of business travelers, the accommodations provided by FabHotels offer affordable lodging options in strategic locales, coupled with reliable Wi-Fi connectivity, thus fostering sustained growth and profitability.
FabHotels – Revenue Model
Franchise Fee:
FabHotels imposes a franchise fee, constituting approximately 20% of the monthly revenue generated by partner hotels. This fee serves as a significant component of FabHotels’ revenue stream and aligns with its strategic approach of collaborating with hotel partners to expand its network of accommodation options.
B2C Reservations:
Individual clients have the option to make reservations directly through the FabHotels website or its mobile application. Through these business-to-consumer (B2C) transactions, FabHotels generates revenue.
Special Discounts & Offers:
FabHotels employs marketing strategies such as discounts, exclusive offers, and loyalty programs to incentivize reservations. These marketing initiatives not only enhance overall revenue by fostering repeat business but also attract new clientele.
FabHotels – Funding and Investors
In total, FabHotels has raised $68.6 million across its eight funding rounds.
| DATE | FUNDING ROUND | AMOUNT | LEAD INVESTORS |
| September 2, 2023 | Venture Round | $20 million | Panthera Growth Partners |
| January 6, 2020 | Series B | $5.6 million | – |
| January 4, 2019 | Series B | $6.5 million | Goldman Sachs |
| January 1, 2019 | Venture Round | – | Tracxn labs |
| July 26, 2017 | Series B | $25 million | Goldman Sachs Investment Partners |
| September 30, 2016 | Venture Round | – | InnoVen Capital |
| June 27, 2016 | Series A | $8 million | Ancel, RB Investments Pte. Ltd. |
| January 1, 2015 | Seed Round | $2.3 million | – |
FabHotels – Growth Overview
FabHotels continues to demonstrate impressive growth, marked by the following highlights:
Expansive Hotel Network: The FabHotels brand is proud to have the capacity of carrying out seven million room stays a year. This amazing feat has been achieved by a network of 1,800 hotels spread all across the country and beyond, serving different groups of travelers over various segments.
Extensive Geographic Reach: By February 2024, FabHotels is present in nearly 82 pan-Indian locations to support itself to be the most premium hospitality supplier throughout the country.
Customer Satisfaction: FabHotels the figure of its service quality achieved a good reputation of 4 million guests; confirmation of the reliability, comfort, and dependability of its customer services.
Substantial Room Inventory: FabHotel, which hosts over 36000 rooms, moves forward, assuring that the demanding and discriminating accommodations of all guests are in safe hands. This strong position makes FabHotels the number one choice in hospitality.
FabHotels-TV and Radio Ads, Social Media Ads & Campaigns
The television campaign ‘Recharge. We have been introducing Refresh, freshly crafted hotels by FabHotels since 2018. To be more precise it was a business, aimed at business travelers namely. So FabHotels created a creative campaign that had a story of rejuvenation with its main target market, the business travelers in mind. This campaign was run on all major television networks as well as societal media sites for example Facebook, YouTube, and other platforms.
FabHotels : Competitors
| Company |
| OYO |
| Treebo |
| RedDoorz |
In the hospitality industry, the OYO develops the position of being the most rivals, taking the front line as the primal competitors to FabHotels.
OYO is an online hotel booking platform based in Gurgaon, Haryana, India and was established back in 2013. The ital cross cultural location of OYO’s head office ensures the proper implementation of its activities.
Treebo becomes another formidable competitor to FabHotels as it has a significant customer base concentrated. Established in 2015, India’s Headquarter-Bangalore, Karnataka is decided as the place where their corporate offices will be seated due to the city’s dynamic atmosphere of the country’s technology and business center.
The achieved reduction in market share solidifies RedDoorz as the main rival for FabHotels in such a sector The beginning of 2015 marked the founding of the company and its home city is Singapore in Central Singapore. In a way, this business is well-positioned using the region as a base, Singapore is the economic leader.
Conclusion
In conclusion, FabHotels stole the limelight and became the leader of India’s hospitality industry in a busy environment providing an unconventional type of hotels which unites the ideas behind luxury and affordability. With their unique market concept designed to offer value priced accommodation to thrifty tourists as well as the fact that the hospitality sector faces certain pressure from an evolving urban environment, FabHotels has grasped the opportunity to become one of the earliest participants in the niche segment.
FabHotels’ business model, which is predicated on low asset acquisition costs and high-quality service levels throughout the franchise network, has made it unique in the highly competitive hospitality market. The fact that it is about the assurance of a secure option and comfortable place that is offered in addition to the The Safe Place to Stay program which is 100% and the Refer-and-Earn scheme have contributed to its popularity among travelers.
