Stanza Living, a managed co-living accommodation provider, has secured $13 million in a bridge round led by Alpha Wave. This equity round, the first in over three years for the Delhi-based startup, underscores both the potential and the ongoing challenges within the co-living sector.
The board at Stanza Living approved a special resolution to issue 1,207 preference shares at INR 911,440.17 each, raising INR 110 crore (approx. 13 million), according to regulatory filings from the Registrar of Companies. Alpha Wave contributed INR 83 crore, while Matrix Partners, Accel India, and Peak XV invested INR 27 crore. This funding round indicates continued investor confidence despite the broader struggles in the co-living industry.
Startup data platforms valued Stanza Living at approximately INR 3,900 crore ($470 million), slightly increasing from its previous INR 3,525 crore ($424 million).
The firm was reportedly in talks to raise $25 million, but this bridge round materialized instead. Previously, Stanza Living raised $57 million in debt led by Kotak Mahindra Bank and RBL Bank in March 2022 and $100 million in equity in April 2021. The company has secured over $230 million across equity and debt rounds.
Operational Growth and Financial Performance
Stanza Living, which offers co-living solutions for professionals and students, boasts over 75,000 beds in 450+ residences across 24 cities. The company’s revenue from operations surged to INR 442 crore in FY23 from INR 115 crore in FY22.
However, losses also increased by 18.71 percent to INR 495 crore in FY23 compared to INR 417 crore in FY22. The company has yet to file its audited financial statements for FY24, which will be crucial for evaluating its current financial health.
Stanza Living competes with co-living startups such as Colive, Your Space, Settl, Union Living, and Coho. In a struggling co-living sector, 41 out of 116 firms shut down in 2023, reflecting significant industry contraction.
According to Tracxn data, venture capital funding for co-living startups shrank by around 85 percent year-on-year for two consecutive years. In 2023, the sector raised only about $6 million, down from $21.7 million in 2022 to $148 million in 2021.
Industry Trends and Adaptations
Despite these challenges, some firms are exploring niche areas like nomad, rural, and luxury co-living. For instance, the Beach House Project offers invite-only residencies designed for founders and creators. At the same time, Nomadgao operates co-working and co-living spaces in Goa that are aimed at the global digital nomad community, with plans to open another property in Lonavala next year.
Additionally, Zolostays has entered the luxury hotel space with the launch of Hotel Z Triloha in Bengaluru, targeting a premium market segment.
Stanza Living has made strategic adjustments to navigate the challenging market conditions, including reducing properties in existing cities, pulling back on experimental verticals, and laying off a section of its workforce. The company’s ability to adapt and innovate will be critical for its survival and growth in the coming years.
Stanza Living’s recent funding round and strategic adjustments reflect the resilience and adaptability required to navigate the evolving co-living sector. Despite the broader industry challenges, the continued investor confidence in Stanza Living signals a belief in the company’s potential to succeed in this competitive market.
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