Working for a long time in the finance sector in California, Vikram Bharati moved to Singapore three years ago and founded Tribe Theory – a chain of hostels conduciveto building businesses and networks.
The goals are ambitious – by 2030 there should be a Tribe Theory hostel in every major city in the world, in one hundred countries. The first hostel in Europe was opened in Tallinn.
‘Life in Estonia’ talked to Vikram Bharati, the founder of the Tribe Theory entrepreneurial ecosystem about the past, the present and the future of his mission.
Vikram, first of all, would you introduce yourself and tell our readers a little about your background. What led you to founding the entrepreneurial ecosystem Tribe Theory?
My previous life was in banking. I spent 8 years in JPMorgan, doing client coverage, helping large companies with their banking. Then I decided to make a change and take my life in a different direction and have a sabbatical for six months. But I had so much fun, so I ended up backpacking for two years, travelling around the world! During that time, I was working on projects on my own, building a couple of startups in Bangkok and so on. While travelling, I met my wife Anna and I moved to Singapore because it was where she lived. So, I got a job here in a venture capital fund and I was offered an opportunity to run the funding for early stage startups. And during that time, I was thinking about my next adventure and I actually pitched the Tribe Theory idea to the same fund I was running: that we should create a new category of hostels where the purpose would be business building more than just a place to sleep. It would be for people who want to build a company or are thinking about creating something on their own. They liked the idea and I built a prototype hostel in Singapore. And it was working! So many interesting ideas, people and investment opportunities were coming through our spaces and we realised there’s something there. So, we started expanding – we opened in Bangalore, India, then Bali, then we went to Myanmar and now Tallinn. We are opening up in Lisbon, Manila… The goal is to build a new brand of hospitality businesses around the world.
So it might happen that when you stay in Tribe hostels, you could pitch your business idea or find a partner to build something together?
The concept is that in each place, the environment is very conducive for building a business, building things. From the events we organise and networking that happens to eventually the people who stay there – they all try to build things. We want every space to be an ecosystem and instead of doing it in a co-working space, we do it in hostels where ideas and people are moving around and we want to capture that.
Can just travellers stay in these hostels or is it strictly for startuppers?
Yes, absolutely, we don’t have any restrictions! In some of our spaces – like Tallinn for instance – up to 80% of visitors are in that category but other places it’s more like 20-30%. We have been open in Tallinn for 6 months now and we see a clear opportunity to increase the number of young entrepreneurs staying with us.
Usually all the great startup ideas come from personal needs or problems that a person needs to solve. How about you – did you get your idea while travelling?
Indeed, while solo-travelling in over 50 countries, I always stayed in hostels and met so many people around the world. I built a massive network of friends around the world.
I genuinely fell in love with the idea of hostelling, but the thing that was missing was that everywhere I went, every single space was targeted towards travel and tourism – city walks and pub crawls etc. I noticed that all the spaces had three very important dynamics. Firstly, the hostels are great aggregators of people from all around the world. So, if you have 20-30 people from different countries, you have 20-30 ideas. Secondly, it is a great distributing point. Third thing I noticed is everyone staying in a hostel is generally a seeker – seeking for new adventures, opportunities, cultural emerges. And you have a small space filled with young seekers. These three dynamics are so powerful that it dawned on me – we could do so much more in these spaces than travel and tourism. And when I was actively seeking ideas while working for a venture capital fund, I kind of put two and two together. I realised that we could use the spaces to become venture builders.
Our mission now with the company is to enable the creation, through our spaces, of one million businesses in the next ten years, by 2030.
It is a very ambitious mission. How do you keep track of the number of companies created?
It’s a good question. We are not keeping very good track right now but we are in the process of building the right systems and tools to be able to track all these things. And we ourselves are a very young company, only a year and a half old, so we have a lot of things to still figure out.
A million businesses by 2030, but how many hostels are you planning to open by then?
The vision is to be in every major city in the world. By 2030, we want to be in 100 countries. And I do believe it’s realistic, because with very little resources and with one and a half years we have already done seven countries.
And where in all that is your business model? Is it the hospitality side or all of the rest that you do in the hostels?
If you do a very good job running a hotel or hostel, you generate approximately a 20% margin. So our foundational business model is this. But what we’re saying is that we want to do something that no one else does and that’s where the real economic value is going to come from. So, we want to focus on the people inside that space where they can create businesses that support the people within the space. This is where very high margins come from – education, venture business – from the talent marketspace. So, all the other businesses on top of the hospitality is where the real economic value will come from. And that’s why it is crucial for us to attract a targeted audience. It doesn’t have to be 100% and I don’t think it will ever be, but even with 40-50% it is good enough for this model to work.
Your Tallinn hostel’s country manager is Indrek Pällo, a former Chief Representative Officer at Enterprise Estonia in Singapore. Did you first hear of Estonia when meeting him?
I would say, yes, that our connection to Estonia happened in a very serendipitous way. Indrek was the head of Enterprise Estonia in Singapore and I met him at an event and I invited him to our hostel launch in March 2018. He really liked our idea and he kept coming back to our events and meeting people. When he returned to Estonia, he kind of jokingly said: “Maybe I could help you guys launch it in Estonia?” And that’s how it started in Tallinn! But it all happened very interestingly. In Singapore, Indrek introduced us to an Estonian entrepreneur Rain Rannu, who was also the managing partner of the early stage investment fund Superangel. So Superangel is now one of our main investors and also our board member.
So, opening your first hostel in Europe in Tallinn was a coincidence?
No, it wasn’t. Even though I met Indrek by coincidence, I have always been fascinated by Estonia in general and I had never been there until after I met Indrek, who invited me to the Latitude59 conference. Before that I was very intrigued by Estonia – by the e-Residency program, for example. Estonia has some similarities to Singapore – very small country with small population but yet it has had a lot of success compared to its neighbours.
So the reason we decided to start from Estonia and Tallinn specifically was that it is probably one of the most exciting startup cities in Europe. Even compared to Berlin or Amsterdam. I think there’s so much more going on than in western European cities. So, for me, the decision was easy to make.
Are you an e-resident of Estonia?
I am and actually the e-Residency program is a very good partner of Tribe Theory. We promote them in all of our spaces, and e-Residency has its marketing materials in all our spaces, and we have done many events promoting them, for example in Bali and in Singapore. Now we’re going to Lisbon to Web Summit and doing an event with the e-Residency team there.
At the time of publishing this article, Tribe Theory was in late-stage discussions with a world-renowned venture capitalist from Silicon Valley who is considering adding some fire power to this concept. This will be announced in early 2020.
Source: Life in Estonia magazine