INSUBCONTINENT EXCLUSIVE:
OYO, the India-based startup that operates a network of budget hotels, has pulled in $1 billion in new funding to grow its business in China
and expand into other international markets.
The majority of the funding— $800 million, tobe exact — was led bySoftBank Vision Fund
with participation from Lightspeed, Sequoia and Greenoaks Capital
OYO said there is also an additional $200 million that has been committed from as-yet-unnamed investors
The dealvalues the five-year-old company at $5 billion.
Before today, OYO had raised $450 million from investors
Its previous financing wasa $250 million round last September which was led by the Vision Fund and includeda $10 million follow-on
investment from China Lodging.
OYO was started in May 2013 by Thiel FellowRitesh Agarwal, who was then aged 19
The company aggregates budget hotels and hostels in India, ensuring that they include minimum standards such as clean sheets, hot showers
It has since branched out into other kinds of lodgings, and verticals that include wedding planning.
Today, OYO claims to have over10,000
franchised or leased hotels in its network, which it says spans 350 cities across five countries.The company announced an expansion beyond
India into China this summerand it is also present Nepal and Malaysia
More recently, itrecently entered the UK market this month.
Its plan forChina — which OYO interestingly today said is a dual &home market&
alongside India — is particularly ambitious, but already the company claims to have reached 87,000 rooms in 171 cities.
China will account
for $800 million of this newly-raised capital, OYO said
The remainder will be deployed to bolster its presence in India and supporting growth in its other overseas markets as well moving into
OYO isn''t saying right now what other overseas expansion plans it has up its sleeve.
We will continue to explore newer businesses while
remaining focused on both organic and inorganic growth
In the last 12 months, we have increased our international footprint to five countries… With this additional funding, we plan to rapidly
scale our business in these countries, while continuing to invest further in technology and talent
We will also deploy fresh capital to take our unique model that enables small hotel owners to create quality living spaces, global,&
Agarwal, the OYO CEO, said in a statement.
