Rhea Silva, Founder – Chototel
Positioned between social renting and affordable housing, Chototel is disrupting traditional ideas about the way we live. As a response to the affordable housing challenge and the increased mobility of today’s generation, Chototel is providing flexible, comfortable accommodation at an affordable price. “From small acorns, great oaks grow”. Chototel’s business model has the power to disrupt the stagnated housing market, by catering to those at the bottom of the pyramid, who have been ignored by society” believes the founder Rhea Silva. “Our business model has the potential to revolutionize the sector because our plans are global. We aim to build 5 million rooms in the next decade across a range of geographies, as part of the solution to the growing issue of housing poverty” she says
A lawyer by education, Rhea has always been interested in entrepreneurship. She was brought into the running of the family business — based in the affordable housing sector – 3 years ago. She recalls that although the dinner table conversations taught her a lot about business from a young age, what she learnt was entrepreneurs are like mountaineers and every new enterprise is a mountain that must be defeated. Some mountains defeat you and some you overcome. Chototel is the mountain that she aims to overcome now. Here are some of her responses to questions by team ABT.
Did you believe in making dreams come true?
I believe that realizing your dreams is the result of passion, dedication and a lot of hard work.
What led to the decision to set up Chototel in India?
The consequences of the global housing crisis are particularly prevalent in India. For example, 28% of urban households in India are classified as substandard, a percentage rivalled by only that of China worldwide. This is a situation that is expected to worsen in coming years: India is a rapidly urbanizing country and its 1200 million people are on the move. Currently, the Indian rental housing sector remains underdeveloped and caters to higher-income demographics. Chototel aims to respond to the demand for affordable housing from ordinary individuals and families moving towards urban clusters. These individuals often cannot afford to buy a home and would like to rent without the hassle of deposits and committed tenures. Chototel’s flexible solution to housing is therefore in high demand.
Today, there is a huge inventory of unsold flats and the market is stagnant. Do you think people prefer a rented option due to high cost of housing?
We believe the rental option is becoming increasingly attractive to average-income individuals and families for two reasons. Firstly, as a nation of 1.2 billion people experiencing rapid urbanization, the demand for affordable housing is increasingly outstripping the supply of homes, causing house prices to skyrocket. Buying a house is becoming increasingly unaffordable for average-income families. Secondly, the way we live is changing as people become more mobile. As a flexible housing solution, renting is better suited to our modern, increasingly nomadic, lifestyles. As a part of the chototel strategy, we will potentially acquire a lot of the unsold flats on the market and rent them out.
Will Chototel launch an “App” to reach out to the customers?
Technology will be embedded in every aspect of Chototel’s operations. Chototel’s app will be used by customers to check-in and check-out, as well as monitor and manage the payments of utilities and services real-time.
Tell us about some of the challenges you faced
As we are a startup, we face the typical challenges that all new hotel companies encounter, starting with land acquisition, permits, and contractors. These issues are common to every market, and our experience in the real estate sector means we have developed ways to overcome them. Using local expertise and management in every market we enter will ensure we are tuned in to the particularities of each market.
What are your future plans for Chototel? Are you looking at funding to expand the business?
Beyond the pilot, our strategy to scale is to acquire built-to-suit inventory from developers globally. Our strategy is not to build. As Chototel grows, we aim to have a presence in the World’s most populous cities, where people are currently struggling to find affordable accommodation. We understand that the possibilities of scale exist most in locations where the velocity of urbanization is highest. For this reason, we are considering locations in Nigeria, the UAE and the UK.
Do you recall any professional experience that has had a strong impact in your life/career/mindset?
The demand for affordable housing solutions became clear to me whilst living in India, and seeing the effects of rapid urbanization first-hand. I became aware of the enormous scale of the issue and the need for a solution. My conception of the super-budget hotel, positioned between social renting and affordable housing, as an ideal solution to this shortage came from my experience working in both the affordable housing and hotel sectors.
There are more opportunities for women today to create a niche for themselves as compared to a decade ago. Do you agree?
Most definitely. There have been a number of trail-blazers in India and internationally, who have paved the way for women’s increased involvement in entrepreneurship and business more generally. For example, Kiran Mazumdar-Shaw, Chairman of Biocon and Indra Nooyi, CEO of Pepsico. We are finally beginning to recognize women as equal and capable leaders in business, and opportunities have opened up considerably compared to a decade ago.
Who is your greatest inspiration and why?
Personally, I think Malala is a truly inspirational figure. She has never allowed her status, gender, language and background to affect her ambitions and goals. Her vision is global, and I admire her ability to think big in terms of social change.
“It’s important to be educated rather than be educated to be Important”, what’s your views?
I think education, both formal and informal, is incredibly important and shapes us in a range of ways. A previously mentioned, I am studying for a law degree and have gained three years of practical experience in the hotel and affordable housing sectors. It is important to understand that successful business ventures are the result of a lot of time and commitment.