Within a week of raising $250 million (Rs 1,600 crore) from Japanese internet and telecom conglomerate SoftBank Group and Sunil Kant Munjal-led Hero Enterprise, besides other investors, online hotel aggregator OYO Rooms on Wednesday said that it has raised another $10 million from China Lodging Group in a follow-up round.
Within a week of raising $250 million (Rs 1,600 crore) from Japanese internet and telecom conglomerate SoftBank Group and Sunil Kant Munjal-led Hero Enterprise, besides other investors, online hotel aggregator OYO Rooms on Wednesday said that it has raised another $10 million from China Lodging Group in a follow-up round. On September 8, OYO raised its largest fund till date from Japanese investor Softbank Group, which will make the investment from its $100-billion corpus Vision Fund. OYO Rooms recently claimed in a blog post that its losses fell to Rs 325 crore in the year ended March 2017, without disclosing the revenue figure for the same period.
“Both in terms of potential opportunities and existing synergy through our complementary strengths and capabilities — the partnership will allow us to pick up new learning. Addressing consumers in India and China, two of the world’s fastest-growing markets, through our combined strengths, opens up a very large and significant growth opportunity,” said OYO Rooms founder and CEO Ritesh Agarwal. OYO and China Lodging Group have signed a memorandum of understanding (MoU) allowing the companies to combine technology knowhow and operations knowledge. Under the terms of the MoU, the firms will partner in case of projects of mutual interest to enable a co-learning opportunity in the fields of technology and hospitality. This would also include exchange programme for employees, among others. “The partnership will draw on the strengths of China Lodging Group’s experienced management team, market leadership through a multi-brand strategy, extensive hotel operations expertise and strong loyalty program and OYO’s advanced technologies in the hospitality industry that enabled transformation of hotel operations,” said Jenny Zhang, CEO – China Lodging Group.
It should be noted that OYO’s previous round of funding in April 2016 of $200 million was also led by SoftBank. Flush with funds, OYO now has the teeth to take on players like Makemytrip, Yatra and others in a space that is increasingly witnessing consolidation. Moreover, with the new round of funding, the company plans to expand its presence in the Southeast Asia region too.
Founded in 2013, OYO currently has 8,500 hotels and 70,000 rooms in around 230 cities on its platform. These include hotels in major metros, regional hubs and leisure destinations, as well as pilgrimage towns. It is also present in Malaysia and Nepal. The hotel aggregator employs over 2,500 people.