Hotel aggregator Treebo Hotels, announced on Thursday that it achieved Ebitda break-even in December. It also reported an adjusted Ebitda (adjusted for ESOP expenses) of Rs 1.65 crore.
The startup also announced that it achieved an annualised revenue run rate (ARR) of $82 million in the same month — representing a 130% y-o-y growth compared to the $36-million ARR a year ago.
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“This Ebitda break-even is a defining moment in our journey. We feel like we are graduating from being a startup, which is often thought of as a licence to be perpetually loss-making, to a real business. What makes this milestone truly special is that it comes in the backdrop of the devastating pandemic which brought the entire travel industry to its knees,” said Sidharth Gupta, co-founder of Treebo.
Treebo’s business model includes both management contracts and franchising agreements with hotel partners. Customers get access to standardised hotel stays at affordable prices and these are listed on Treebo’s online site and other online travel aggregators. The company reported that it had a portfolio of 850 properties and roughly 20,000 rooms across 120 cities as of the end of 2022.
Gupta added that the company has consistently operated with “solid” unit economics and has been profitable post all variable and semi-variable expenses for a while now. “That, combined with a culture of strong cost discipline and growing scale, allowed us to hit Ebitda break-even,” he said.
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Treebo also recently announced a master franchise partnership with Radisson Hotel Group to launch a new brand called Park Inn & Suites by Radisson in the mid-tier segment. The company has already announced the first sign-up under that brand — a 91-room property in Guruvayur, Kerala. In 2021, it also announced a strategic partnership and investment from Accor Hotels. Treebo was founded in 2015 by Sidharth Gupta, Rahul Chaudhary, and Kadam Jeet Jain. To date, the company has raised around $85 million in both equity and debt including from investors like Innoven Capital, AccorHotels, Bennett Coleman and Co, Bertelsmann India Investments, Elevation Capital, Matrix Partners India and others. Treebo competes with other hotel brands such as OYO Rooms, FabHotels, Ginger Hotels, Lemon Trees and many others.