BPI France buys minority stake in New Nomads

José Rojo
19 February 2016

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French state investor BPI France has purchased a minority stake in Lyon-headquartered youth hostel operator New Nomads to support the company's expansion plans.

The deal saw BPI France secure a minority stake in New Nomads. Charlotte Bollard, Julien Routil and Pierric Soum, who co-founded the hostel operator in 2013, will remain as majority owners.

The institutional funds, the first to be raised by New Nomads since inception, will finance its expansion plan for the next few years. The business has been operating a single youth hostel in Lyon since 2014 and is now eyeing new 1,500-2,000 m² sites across France's major tourist hubs.

During 2016, the company will first add a second, 120-bed hostel in Lyon and follow this with a new establishment (L'Auberge de Buzenval) in east Paris. Put together, the new developments should boost its capacity to a total of 500 beds and bring the workforce to 50 employees, up from the current 15.

The investment saw BPI France draw equity from France Investissement Tourisme, a tourism-focused fund that launched with a €100m target in October 2015. Contacted by unquote", BPI France declined to comment on the sum it invested in New Nomads but the fund typically deploys €500,000-5m per deal, according to unquote" data.

Prior to New Nomads, the fund's maiden deal took place in October 2015; at the time, €500,000 was injected into France Hostels, another youth hostel operator.

Company
Founded in 2013, New Nomads started by setting up a first youth hostel in June 2014: located in central Lyon, the facilities were branded as Slo Living Hostel. The business intends to open a second establishment in Lyon in Q3 2016, featuring an estimated 120 beds. The company currently employs 15 staff.

People
BPI France – Lionel Giai-Gischia (investment director); Anne-Claire Sigaux, Charlène Dumont (project managers); Martine Huguenet (analyst).
New Nomads – Julien Routil (co-founder, CEO); Charllote Bollard, Pierric Soum (co-founders).

Advisers
Equity – Périclès Avocats, Lisa Velut (legal, social due diligence); BF Audit, Frédéric Brejon (tax, financial due diligence).
Company – Lamy & Associés, Pierre Guignand (legal).