In a little over month’s time since turning China’s second-largest hotel chain in terms of room count, OYO’s China entity — OYO Jiudian has now become the country’s largest hotel chain expanding from 320 cities and 450,000 rooms till the fourth week of May 2019 to over 337 cities and 500,000 rooms. OYO was founded by Ritesh Agarwal in 2013.
In China, OYO has now “surpassed the scale of traditional and established hotel chain brands in the country, such as Home Inn, Hanting and others,” the company said in a statement. OYO has been on growing on a breakneck pace in the past few years along with recent growth in the US.
The company’s latest acquisition of Amsterdam-based vacation rental company @Leisure Group around last month has taken OYO’s presence to over 800 cities in 74 countries from earlier over 500 cities in more than 10 countries.
OYO’s rapid scale comes on the back of its large rounds of fundraising on regular intervals. Recently, it raised $75 million in April this year from Airbnb after raising $100 million each from Didi Chuxing, SoftBank, and Grab in February 2019 and December 2018 respectively. It had also raised a massive $1 billion round led by SoftBank in September last year.
The company has now allocated around $100 million from its $600 million commitment earlier for business in China even as it has hired more than 10,000 people and created jobs for more than 200,000 Chinese hospitality enthusiasts, the company said.
However, the fundraising spree doesn’t end with Airbnb round. Financial Express Online earlier this month had reported that OYO is raising another massive $1 billion round of funding from a new investor to lead the round along with existing investors including SoftBank, Grab, DiDi Chuxing, Sequoia, Airbnb and others, This would value at a whopping $10 billion, sources with direct knowledge of the development had told Financial Express Online.
“OYO is in talks with a new investor to raise $1 billion in the new round and will value the company at $10 billion,” one source had said. However, the new investor’s name couldn’t be ascertained.
OYO Jiudian currently gets over 3 lakh travellers “resting their heads on OYO Jiudian pillows each night,” said Sam Shih, COO, OYO China, adding that the company will continue to focus hiring more people and retaining top talent.
OYO also announced the appointment of Zhu Lei as its Chief Revenue Officer. Lei was the former President at Belgium-based brewing company Anheuser-Busch InBev.
The company has also been working on a collaboration with online travel agencies in China to attract more customers. For instance, last month OYO had strategically partnered with China’s leading OTA Ctrip to generate more demand for each other’s services by offering seamless access to services to customers of both brands.
“Ctrip customers will be able to book an OYO from within Ctrip app and website as Ctrip gets access to OYO’s vast network of 10,000 hotels in China across 320 cities while OYO gets access to Ctrip’s more than 300 million registered users,” an OYO spokesperson had told Financial Express Online.
OYO is also exploring such tie-ups with other OTAs such as Fliggy etc., and has also recently announced a strategic partnership with Alipay and later launched the OYO miniprogram in Alipay to focus on areas including membership, traffic exchange, scenario integration, finance services, smart payment, credit life, and hotel upgrades.