Growing 25X in 4 Years: The Role of Capital in Scaling EzStays

Vaibhav Khanna, co-founder of EzStays, shares how debt fueled the company’s growth from ₹2 crore in 2021 to a projected ₹55 crore in FY24. His experience is a lesson in leveraging debt effectively, maintaining discipline, and timing capital needs to seize growth opportunities.

Student housing is evolving. Today’s students don’t just want a place to stay; they demand structured, hygienic, and organized accommodations. This shift presented a massive opportunity for EzStays to build housing spaces.But the challenge was the same as for any capital-intensive business: how to raise capital at the right time to ride the growth momentum.

Then, COVID-19 hit.Like many others, EzStays was heavily impacted, with operations paused for months while rent leases remained active.

As colleges reopened and an influx of students started returning, they needed capital quickly to open more housing spaces. Traditional lenders demanded collateral and had a long approval cycle. One bank took two months to process a very small loan, a timeline that simply didn’t align with the company’s working capital needs.

Khanna turned to Recur Club, which gave EzStays the runway it needed within just 10 days. This swift access to debt allowed the business to survive the crisis and set the stage for exponential growth in the years that followed.

For EzStays, the decision between debt and equity came down to time. Growth opportunities were tied to the academic calendar, leaving only a few months to scale each year. Equity would have taken 6-8 months to secure, but debt allowed them to capitalize on short windows of opportunity.

“Debt isn’t free money. It requires more discipline than equity. When you take on debt, you’re committing to something more significant than just financial repayment; it’s a commitment to the long-term credibility of the business. This forces you to manage resources wisely and scale responsibly,” Vaibhav said.

Khanna emphasizes that debt makes you value every rupee spent. The consequences of failing to repay can extend far beyond your balance sheet—they impact your reputation, the future of your business, and your personal credibility.

EzStays intelligently leveraged debt as bridge capital, eventually growing its revenue to more than ₹35 crores in FY23. It helped them grow their sales, stay disciplined, save equity, and prepare to raise at a much fairer valuation during fundraising.

For entrepreneurs, the takeaway is clear: plan ahead, be disciplined, and always respect the long-term impact of the financial commitments you make. In the right hands, debt can be the fuel that drives your business to new heights.