Backpacking through Entrepreneurship
Mr.Dharmveer Singh Chouhan, CEO and Co-founder of Zostel has been in the travel industry for a while now. From his initial days as a gaming-enthusiast, he sure has come a long way by building a successful brand that serves a niche community of travellers. We got in touch with him post his talk during E-Next 2020. Below is the transcript of the interview.
Q. What’s the current scenario in the travel industry? And what’s the next big trend?
To really understand travel in India, we ought to look at the global picture. Something as simple as Uber can work effectively in many regions of the world, irrespective of factors like language. The same applies to others like Airbnb as well. I think we’re a beautiful nation with more potential than all of Europe combined. And why do we travel? Because there’s a beautiful story attached to each place, which in India is aplenty. There’s also the uniqueness of cuisine, diversity in culture. The “Athithi Devo Bhava” culture is deep-rooted here. We’ve got all the raw materials for the travel industry right. I wouldn’t have cared to build hotels in India as such, if not for the potential I just spoke of. But there is a gap due to the fact that we have a reputation of being unsafe. For instance, a post about travelling to India is more often flooded with comments about safety than a similar post on, say Vietnam or elsewhere. More than the real problems, this is the issue we face.
We are moving from search-based travel to discovery-based travel. We are going through an infrastructure building phase and we can unlock more destinations. Everyone wants to travel authentically and to gain an experience out of a place. That’s where the industry is heading today, to mingle among the locals or if someone’s traveling solo, then to make new friends is an integrated approach. The larger trend is to leave their busy lives behind and try something new. With respect to trends, earlier we (Zostel) were in the headwind but now, we’ve got tailwinds too.
Q. Can you give us an insight into Zostel’s DNA?
We built Zostel as a place where the seekers could bond. The number of people who travel this way is less than 1%. But we wanted to build an internal community. A great accommodation place becomes better with a great host and the safety aspect comes from a person we can trust. This is what Zostel seeks to do. Nearly 140 odd countries today have a visa-on-arrival facility in India, so it is already commercialised. Most Zostels are run by local franchises from whom we charge around 10%. We believe in a flexible approach to travel, everyone in the ecosystem gains, including the brand.
Travel is surely a passionate thing, but it has the problem of lemons and oranges. Say if you’re travelling to the North East (which is usually a one time trip) and are seeking to rent a bike. You’d be in a dilemma about whom to pick. This is where we come in here. We spread an opinion through word of mouth often built on Zostelers’ experiences.
I want the industry to go through that clean-up phase wherein it becomes unprofitable to cheat people. Zostel has achieved that to a certain extent today. Out of 1.2 million people that we’ve served, over 400,000 of them have been inbound tourists. So, we’ve got a good image to start with on the other side and hopefully with the right tools, we can really empower anyone who wants to contribute to the travel ecosystem in our country. We are looking for passionate people who can serve in this regard with specificity to the region they want to serve.
Q. In your speech, you mentioned a name ‘Seekers’ which would eventually become Zostel. Why Zostel?
I wish there was a better answer to this but it’s purely a result of branding. Seekers was a name that I thought of because it was indicative of some form of courage in travel. But I couldn’t find a web domain named Seekers.com. It was obviously going to be impossible to find any word in the dictionary that could be used as a domain name. I sat with Abhishek Bhutra (a co-founder), from about 1 am in the night. By 4:30 in the morning, we’d finalized it. I started with Hostel, removed the H and tried an A and various other combinations and when it came to ‘Zostel’, the name stuck. It was a no-brainer because it could be a noun or a verb like ‘Zostel-ing’ and any backpacker hostel almost identifies itself with a Zostel today.
Q. How do you choose your partners, given your promise of experience and so on?
We certainly are very selective. We have an Entrepreneurship Development Programme, wherein we receive applications on a daily basis. We received over 4000 applications out of which, we picked 38. We’re focused on the individual, because we don’t want profit-seekers. We want those who are really committed to the same cause as we are. We’re possibly looking out for someone who is as crazy as us. And for the most part, every property we add has a large investment. In contrast with other aggregators, we look at our properties differently. We do not simply add them on the basis of reviews or ratings. We’re bent on providing the experience and so we believe that even if we’re supply-constrained in that aspect, we’re still providing that. We’ve consciously chosen to be small, but have a great brand value so that we may then lay the technology layer over it and set the systems in place. Even if we do handpick them, we understand that our partners may change. We’re constantly monitoring that aspect as well with the help of an internal feedback system that helps maintain transparency. So even as a partner, they’ve got to earn the tag of a Zostel and the perks that come with it.
Q. Over the last three years, you’ve associated yourself with Opoch, a cryptocurrency-based startup. In the past, you’ve talked about awareness of cryptocurrency in various countries. Would you quantify the awareness in India and if so, how?
People on the Internet have at least come across the term Bitcoin even if they do not know what it is. We’ve regulated it in a certain sense in India, although no RBI-recognized entity is allowed to trade in this form*. There is no ecosystem coming up in this regard as such and everything so far has been in the form of peer-to-peer transactions. The reason I am committed to the crypto-space is because to build truly large companies, you need to understand the markets that will help you do so. This is what organizations like Google, Microsoft and Apple really managed to do. Google is growing today because the Internet is expanding and similarly, the cloud environment is really picking up the pace allowing Amazon to do well. Warfare could be in the form of trade, thanks to these companies because we live in a capitalized, globalized world. The way to keep them at bay is to build a product that people in countries like the US can invest their time in so that we can get our money back in some ways.
Opoch as such is registered in Singapore and we’re looking at a commercial launch in the next quarter. Bitcoin isn’t consumer friendly; it merely has an investment cycle. And from the perspective of the masses, there is no utility. At Opoch, we’ve provided the back-end infrastructure that allows the masses to register and work with cryptocurrencies without entering the cryptospace. We’re trying to build all the technology that is needed to bring everyone into this space. From an Indian perspective, I don’t see ourselves progressing rapidly with regard to regulations but if we can do well with a product made locally in a country elsewhere in the world, then that gives us the incentive to try and talk to the government on some scale about all of these. I think we as a country can do a lot better in the economic space, provided we’re given what is needed to monetize global wealth, information and knowledge, which is where I think bitcoin plays a huge role. Opoch, I hope, becomes the infrastructure layer that enables this.
* Days after this interview was taken, a landmark judgement was delivered by the Supreme Court of India directing the government to create regulations surrounding cryptocurrency
Q. Is there any chance at all that you may be willing to merge any set of aspects of Zostel and Opoch someday?
Zostel is a platform that we hope to see enabling people to do what they like to do. We’ve got clubs inside Zostel, like sports, photography, Sci Tech and so on. When we do end up having an app of sorts, then people can register and these commonalities in interest can be worked upon as well. We’ve got a volunteer programme wherein the selected person is asked to stay in a Zostel for a month with all of his/her expenses taken care of and they’re asked to take care of the incoming guests in that time period. In essence, we’ve created opportunities based on the first principle. We’ve got programmes that allows artists to perform at Zostels over a weekend stay with all their basic requirements taken care of, so that’s an example of yet another opportunity. I see Opoch as more of the “browser” moment, coming from the fact that the Internet existed years before someone could make some sense out of it. If there exists an instant, micro programmable interface that accepts payments even on a small scale, then we must build applications that enable this. I’d say that we’re only being limited by our creativity and the financial outcome. If Opoch can make a difference to the latter, then Zostel becomes the community layer and Opoch can be the infrastructure layer that corresponds to it.
Team Bridge would like to thank Mr Dharamveer for his time and enthusiasm. We’d also like to thank the organizing team of E-Next for making this interview possible.
