The freshly-generated capital is to be channelised towards developing OYO’s made-in-India business model on an worldwide level as the company plans to expand its presence across South-East Asia.
Founded by Agarwal in May 2013, OYO has so far raised more than $400 million, making it the most well-funded budget accommodation startup in India and one of SoftBank’s biggest bets in the country after some of its portfolio companies such as Snapdeal and real estate portal Housing nosedived.
Existing investors Sequoia India, Lightspeed Venture Partners and Greenoks Capital participated in the funding round, while Hero Enterprise joined as a new investor.
SoftBank’s additional investment into OYO comes after it pumped in $2.4 billion into Indian e-commerce company Flipkart, $1.4 billion into Paytm and about $250 million into cab aggregator Ola earlier this year.
Find new deal opportunities, super-charge your fundraising efforts and track top managers with VCJ. Ritesh Agarwal, Founder & CEO of OYO, added that the company will deploy the fresh capital to expand in global markets which have India-like supply-demand imbalance in real-estate and hospitality. “We’re excited to continue to support OYO as they further expand their position in India and bring the OYO promise of affordability and elevated hospitality to other markets around the world”, said Justin Wilson, SoftBank’s Board representative on OYO. The company is developing capabilities to add 10,000 rooms to its network each month, Agarwal claimed. The fresh capital infusion is also expected to support the organic expansion to newer markets in India and overseas, and enable the firm to bring additional resources to accelerate enhancement customer experience and strengthen the technology stack. “We are delighted to join other marquee investors in OYO’s exciting journey towards becoming a global brand”.
“The differentiated thinking and ingenuity that Ritesh and his team bring to this industry give us confidence that OYO can scale, innovate and set new benchmarks in customer experience”.
Oyo’s rival MakeMyTrip is trying to strengthen its own budget hotel segment and had launched ValuePlus in 2015. Oyo is taking properties on lease to control customer experience via Townhouse Properties.
OYO now operates about one lakh rooms in 8,500 hotels across the country. These include hotels in major metros, regional hubs, leisure destinations as well as pilgrimage towns.