OxfordCaps operates via three sub-brands across price segments
Parents of Kaustabh Lahoty, a B Com student at Hansraj College in Delhi, were concerned about the food quality at his new accommodation provided by OxfordCaps. “But OxfordCaps turned out to be a different story with hygienic, FSSA- quality food,” says Lahoty, who hails from Jaipur.
Founded in 2017 by Annu Talreja and Priyanka Gera, OxfordCaps is a Singapore-headquartered student housing platform. The company’s 80 per cent of business comes from India. The student housing start-up has recently raised $8 million in Series A funding led by Times Internet, besides participation from existing investors Kalaari Capital and 500 Startups.
“More than 10.4 million students across India migrate to cities every year to pursue their academic dreams. However, student housing today suffers from a high level of fragmentation, lack of quality solutions, price transparency, reliability and complete lack of tech enablement of processes. OxfordCaps is addressing this gap,” said Vani Kola, MD at Kalaari Capital.
OxfordCaps helps provide a hassle-free and technology-driven living experience to Gen Z students (those born after 1992) in India and Singapore. The company offers fully-fitted and custom-designed accommodation with full-stack service model, including WiFi, laundry, meals, housekeeping and an array of activities focused on career development and lifestyle for students.
OxfordCaps seeks to provide an alternative in a market that is largely by the unorganised PG (paying guest) segment.
OxfordCaps operates via three sub-brands across price segments —OxfordCaps Premium Residences, OxfordCaps Student Residences and OxfordCaps Dorms for the budget segment. The company works in co-ordination with universities and colleges.
“OxfordCaps was founded keeping in mind the Gen Z students who travel to a new city for studies. The largely fragmented, non-standardised student accommodation — PG (paying guest) and poorly managed hostels have left a huge gap for the right product for this segment”, said Talreja, CEO and co-founder of Oxfordcaps. The company runs on an asset-light model of acquiring properties on long leases with property owners. These leases come with 9-10 year tenures. It retrofits those buildings and upgrade them.
Priyanka Gera (left) and Annu Talreja, co-founders of OxfordCaps
“We provide full-stack services and are not into any sort of part inventory. OxfordCaps is ‘student only company’ and we do not entertain working professionals,” said Gera, COO.
OxfordCaps sees opportunity in the $15-billion market, with more than 10.4 million students across India migrating to cities every year to pursue their academic dreams. Other players in this market include CoHo, Zolo Stay and Stanza Living.
The start-up has clocked 45X growth in less than 10 months since its launch in India and has expanded from 200 beds to over 9,000 beds. The company is in the process to add 2,000 beds across Delhi, Greater Noida, Gururgram, Indore, Chandigarh, Jaipur, Pune, Bangalore, Ahmedabad and Dehradun.
It aims to grow 55X with 11,000 beds by the start of the 2019 academic year (June onwards) and 200,000 beds by 2022 in India, covering more than 50 cities. OxfordCaps is also exploring Asia Pacific markets like Malaysia and Indonesia.
The students are offered multiple options for payments from monthly to a one-time annual payment. OxfordCaps Dorms charges start at Rs 8,000 per bed to OxfordCaps Premium residences that start from 15,000 per bed.
The platform claims that it is already Ebitda (earnings before interest, tax, depreciation and amortization) positive at a property level and hopes to be Ebitda positive at the corporate level in the next 15-18 months.
The fresh capital raised will be used for fueling the company’s growth with expansion into more than 10 cities and standardisation of its student housing product.
A good time for student housing start-ups
Rohit Pateria, CEO of Placio, a start-up in student housing and co-living space
This is the start of a good time for student housing start-ups. VC and PE are finding this space attractive.
Now both direct participants, including higher education institutes and property owners, and indirect participants are realising the need for professional student housing companies.
The new round of funding in OxfordCaps will give them sufficient leverage to take the company to next level. Growth capital will help them to expand in new micro markets
The biggest challenges are quality supply, trained manpower, quality vendor and operating capability.
Start-ups face self-imposed challenges of fast growth and start chasing numbers and top lines. They carry big execution and financial risk. The other challenges which are still unaddressed are tax regulation and licensing policy. For any start-up to be successful in this segment , important things are right positioning, eye on margins , right partnerships and healthy growth.“