Why Did Stayzilla Fail - Check Their Failure Analysis Here! - Bizzbucket

2/5/22, 5:05 PM Why Did Stayzilla Fail? Check their Failure Analysis here!
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Why Did Stayzilla Fail? Check their Failure 2
Analysis here! Search … Search
Published August 13, 2020 by teambizzbucket
Stayzilla was once known as Airbnb of India. Why did it have such a tragic
end? They were the trailblazers of an online marketplace for
accommodation booking in India. They wished to revive the Indian
concept of ‘Atithi Devo Bhava’. But envisioning is different from fulfilling.
Let’s know-how.

https://bizzbucket.co/stayzilla-startup-failure-analysis/#What_was_Stayzilla 1/13
2/5/22, 5:05 PM Why Did Stayzilla Fail? Check their Failure Analysis here! | Bizzbucket
Stayzilla - Any Room Any Budget Any City

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Index:
1. Index:
2. Founder Details:
3. Revenue Model and Sources:
4. Funding and Investor Details:
5. Business Model
6. Competitor Analysis
7. Failure Analysis:
8. Possible fixes
9. Do tell us what you think!
10. Related Articles:
11. What was Stayzilla?
12. Who Founded Stayzilla?

Founder Details:
Yogendra Vasupal along with his two college friends Rupal Yogendra and
Sachit Singhi founded Stayzilla in 2005. Stayzilla got its name in 2010,
earlier the company was known as Inasra. Yogendra Vasupal started his
entrepreneurial journey at the age of 19. He was 2 times drop out of
college having no interest in academics. He was an avid traveler and
realized the problem of the under-supply of rooms in India.
They covered about 55,000 hotels, guest houses, homestays, and

boathouse across 900 cities in India. In India, without the presence of
agents, it was a tedious task to book lodging in tier 1 and tier 2 cities, but
they established a successful homestay platform.
Revenue Model and Sources:
Their website provided the best deals for the customer to find hotels,
guest houses, rentals, lodges, homestays, and any kind of accommodation
from travelers to non-travelers. They act as a broker providing concierge
service to its customers and hotels. The primary revenue model involved
‘commission per transaction’. They also had other means to earn like any
other website like advertising.
STARTUP ESSENTIALS 
Funding and Investor Details: Everything you need to know about MVP, Alpha,
and Beta?
Their startup idea for India attracted various investors. It was estimated
What is Angel Financing and how does it work?
that Stayzilla has raised more than $33.5 million from 4 rounds of funding.
Why do you need a Co-founder for your Startup?
What is Growth Hacking and how does it work?
What is a Startup Term Sheet and how to read it?
First round Angel funding in 2012: $500k
Second round of Series A funding was received from Matrix Partners but
the amount was not disclosed.
Third round Series B funding in 2015: $20 million from Nexus Ventures
Fourth round Series C funding in 2016: $13 million from Matrix Partners
Matrix Partners and Nexus Ventures were the major investors for Stayzilla.

Business Model
Initially known as Inasra was an online travel agency. In 2010, changes

were brought from agency to a hotel aggregator model. India has a very
fragmented kind of ‘stay’ business and this needed to be changed. Unlike
other startup companies Stayzilla not only focused on Hotel bookings;
they wanted to cover every kind of accommodation available in the
smallest of the smallest zillas of the country.
This niche was completely fresh for the country, a convenient stay in
budget, with pre available choices for easy travel within the country. In
2013, Stayzilla was successful in 500 bookings per day covering over 1100
cities across the country. It was a major turnover in the travel and tourism
sector where Stayzilla played the role of ‘The Godzilla of homestays’.
Competitor Analysis
STARTUP TOOLS: 
MakeMyTrip and Goibibo were Stayzilla’s competitors. But competition Top Free Invoice and Legal Documents Tool
was not as much at that time because the idea was fresh to India. The real Free A/B Testing & Growth Hacking Tools
competition was the digital revolution, which was on brick in India. Many
people were not well versed with technology. Free Startup and Project Name Generators
Free Idea Management Tools

Moreover many didn’t have basic internet nor knew how to take
Free SEO and Website Analyzers
advantage of such services. This made it difficult to reach the vast majority
of the population.
STARTUP BASICS
Everything you need to know about MVP, Alpha,

and Beta?
How to write Startup Elevator Pitch with

Examples
Failure Analysis:
Devil’s Advocate Theory: Does It Help
Challenges faced were endless throughout the 12 years of their operation: Organisations?
Fundraising Experience of Aditi Sinha (Co-

Even the basic necessity of customer satisfaction was not fulfilled. Founder of Locale.ai)
This the first step that startups are built on, i.e., solving problems
What is Founder Vesting and how does it work?
for the audience. Mismanagements in customer service lead to
very bad experiences for the users. Complaints regarding
confirmation of bookings yet resort records show no bookings and
deducting the number of services not available to customers but
no refunds at the same time. The downfall was near with rising STARTUP CEMETERY:
complaints.
Why Did ShowNo Towels Shutdown? Here is the
It was very difficult to educate and encourage the host and the
complete analysis!
guest to use this concept of a homestay. Being the first company in

this sector using technology was death before starting to their What happened to Pets.com? Here are the
earnings as people are not familiarised with its advantages. reasons for its failure!
They could not receive as much fundings according to the planned Why Did Stayzilla Fail? Check their Failure Analysis
revenue. Funding was just enough for them to create a platform for here!
alternative homestays but this could not make up the practical
Why Did Friendster Shutdown? Here is the
homestay demands. More cash for burnt then obtained on
complete analysis!
bookings.
Basic services like technology, logistics, and public goods were What happened to Myspace? Here are the reasons
missing. for its failure!
The startup completely derailed after a few years of functioning. The

failure of Stayzilla wasn’t its own failure but a failure for the whole
country’s trust in startup companies. Stayzilla’s failure led to many BUSINESS MODEL:
controversies with the arrest of co-founder Yogendra Vasupal.
What happened to Hike Messenger? Here are the
reasons for its failure!
Possible fixes
Lululemon Business Model: How Lululemon
The company from the start had no clear goals noticed in their planning makes money?
and strategy. They lacked in various aspects from quality service to assist
How Does Meesho Make money and their Story?
in solving grievances. No actions were taken to solve the problems arising.
Mismanagement, fraudulent activities, and lack of communication among Square Business Model Breakdown: How Square
stakeholders completely ruined the goodwill of the company in the makes money?
existing market. Customers eventually lose their trust in the company. LIC Business Model: How LIC makes money?
Bringing up an idea and meeting practical demands is where reality hits.
That’s why it is important to have thorough market research and practical
application on a small scale. Founders completely lost focus midway of
functioning due to improper planning.
SHARK TANK PRODUCTS
BoomBoom: What Happened After Shark Tank?

[Updated]

Cave Shake (Space Shake): What Happened After

Shark Tank? [Updated]
Minus Cal: What Happened After Shark Tank?
Sarah Oliver Handbags: What Happened After

Crooked Jaw Clothing: What Happened After

Do tell us what you think!
Come on!
Tell us what you think of our Dead startup analysis on “Stayzilla: Startup
Failure Analysis” in the comment section. BUSINESS PSYCHOLOGY:
Difference between Heuristic and Biases and their

Also, do check useful Startup Resources and Tools below and do join our
types?
newsletter 📰 for free for more interesting Business Case Studies 💰,
Startup knowledge 🚀, and Startup founders podcast 🎙️delivered to Dunning Kruger effect: Why it matters in
your inbox every Sunday morning. business?
What is a Representative heuristic and how does

it impacts your business?
STARTUP Halo effect: Why it matters in business?

NEWSLETTER STARTUP TOOLS CASE STUDIES CEMETERY
Endowment Effect: Why it matters in business?
Do follow us:
Related Articles:
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Root Suit: What Happened After Shark Tank?

Boot Illusion: What Happened After Shark Tank?
Plop Star: What Happened After Shark Tank?
Cookie Kahuna: What Happened After Shark Tank?
How Shark Tank’s FinalStraw works?
How does Shark Tank’s BoxLock works?
How does Shark Tank’s Boxlock work?
Thin Gloss: What Happened After Shark Tank?
What was Stayzilla?
Stayzilla was once known as Airbnb of India. Why did it have such a
tragic end? They were the trailblazers of an online marketplace for
accommodation booking in India.
Who Founded Stayzilla?
Yogendra Vasupal along with his two college friends Rupal Yogendra
and Sachit Singhi founded Stayzilla in 2005. Stayzilla got its name in
2010, earlier the company was known as Inasra.

teambizzbucket
    
Published in Blog and Startup Cemetery
startup cemetery Stayzila failure analysis
Soni  Reply
Amazing!

frolep rotrem  Reply
Awsome post and straight to the point. I don’t know if this is truly the best
place to ask but do you folks have any ideea where to employ some
professional writers? Thanks 🙂
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2/5/22, 5:05 PM Why Did Stayzilla Fail? Check their Failure Analysis here!

Why Did Stayzilla Fail? Check their Failure 2

Analysis here! Search … Search

Published August 13, 2020 by teambizzbucket

Stayzilla - Any Room Any Budget Any City

They covered about 55,000 hotels, guest houses, homestays, and

Revenue Model and Sources:

What is Growth Hacking and how does it work?

What is a Startup Term Sheet and how to read it?

First round Angel funding in 2012: $500k

Initially known as Inasra was an online travel agency. In 2010, changes

Free Idea Management Tools

Everything you need to know about MVP, Alpha,

How to write Startup Elevator Pitch with

Fundraising Experience of Aditi Sinha (Co-

The startup completely derailed after a few years of functioning. The

BoomBoom: What Happened After Shark Tank?

Cave Shake (Space Shake): What Happened After

Minus Cal: What Happened After Shark Tank?

Sarah Oliver Handbags: What Happened After

Crooked Jaw Clothing: What Happened After

Difference between Heuristic and Biases and their

What is a Representative heuristic and how does

STARTUP Halo effect: Why it matters in business?

Root Suit: What Happened After Shark Tank?

What was Stayzilla?

Who Founded Stayzilla?

Published in Blog and Startup Cemetery

startup cemetery Stayzila failure analysis

frolep rotrem  Reply

BIZZBUCKET RESOURCES LEGAL

About Us Resources Privacy Policy

Advertise Startup Tools Contact Us

Get Paid To Write! Case Studies Indian Startup News

Indian Startup News Startup Basics

Join Us Startup Cemetery 

Indian Startup News

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