RoomsTonite shutting shop after Stayzilla debacle

CHENNAI: Its a bad summer for the hospitality trade. the Bengaluru-based online hotel aggregator, RoomsTonite is learnt to be downing shutters , shortly after Chennai-based Stayzilla shut shop. The hotel booking app RoomsTonite, raised $1.5 million in December 2015, and was started by serial entrepreneuer and IDS Solutions chairman Suresh John.
Founded in June 2014, the company started having trouble with its cashflows since last August. "Some of the top executives were shifted to IDS Solutions early September. But many employees were asked to leave in February with one month's salary, " said a former employee.
RoomsTonite offered budget, premium and luxury hotel rooms at a discount to its app users and made its revenues from the commissions from bookings. The app also offered users the choice of home stays and vacation rooms and touted itself as "the perfect solution for last-minute, hassle-free bookings."
Repeated attempts to reach the company turned futile.
Last year, the company tried to raise money, failing which the decision was taken to shut down, said the source. Staff said though senior management did not communicate the changes with them, some employees had already started looking for other jobs.
"First, you couldn't download the RoomsTonite mobile app on Apple. Then it wasn't available on Google Play. Staffers were definitely panicky," said the source.
Coming so close on the heels of Stayzilla's shut down, what does it mean for the space? "The accommodation space in India is large, exciting; with lots of opportunities. Different companies adopt different business models to tap into this space. When some of them don't work out, it's unfortunate. But that should not be taken as a reflection of the space," said Sidharth Gupta, co-founder, Treebo Hotels, a competitor for RoomsTonite. Treebo raised Rs 112 crore in funding last July.
 
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