Led by SoftBank Investment Advisers (SBIA) with participation from Lightspeed Venture Partners, Sequoia, and Greenoaks Capital, OYO has raised $800 million in its latest financing round. Five-year-old online hotel room aggregator OYO has announced a $1 billion fundraising program from prominent Japanese investor Softbank and others, primarily to expand its operations in China and other countries.
While the company has also received an additional $200 million commitment, bringing the total amount to $1 billion in this round.
In the last 12 months, we have increased our international footprint to five countries – India, China, Malaysia and Nepal, and more recently in the UK. He added; with this additional funding, we plan to rapidly scale our business in these countries, while continuing to invest further in technology and talent – Ritesh Agarwal, Founder & CEO, OYO
According to sources privy to the development, the valuation of OYO reaches $3-4 billion post the round bringing it in the league of other Softbank-backed unicorns such as Ola.
Last week, OYO said it plans to hire over 2,000 technology experts and engineers by 2020. The company hopes to invest in technologies like artificial intelligence, machine learning, and IoT that will make curated guest experiences at every price point a reality while ensuring sustainable incomes for partners and livelihood prospects for several Indians.
The company claims that it has 125,000 rooms in India and is witnessing three-fold growth in transactions year-on-year, with net take rates over 20%. On the other hand, Oyo China has a presence in 171 cities with over 87,000 rooms.
Launched in May 2013 by 23-year-old Ritesh Agarwal, OYO used to aggregate select rooms across hotels and offer them on its website. However, the company faced many backlashes on social media for poor customer service and poor inventory quality in some parts of India.
Currently, it is on an acquisition spree. That is, it acquired three startups this year. These include Mumbai-based Weddings, an online marketplace for wedding venues and vendors; Chennai-based service apartment operator Novascotia Boutique Homes in March; and the Internet of Things technology venture, AblePlus, in July. The company is also targeting 100 venues by December this year in eight cities, including Delhi/NCR, Jaipur, Lucknow, and Kolkata.
