India-based short-term accommodation platform Oyo has approved $1.5bn in funding from investors including telecommunications and internet group SoftBank’s $98.6bn Vision Fund, the Economic Times reported today.
Vision Fund entity SVF India Holdings is supplying $807m while the other $693m is coming from RA Hospitality Holdings, an investment vehicle formed by Oyo founder and CEO Ritesh Agarwal. The round values the company at $10bn.
Oyo provides access to short-term accommodation through its online platform. It partners existing hotel and guest house owners and rebrands their outlets with its own branding while ensuring they meet a minimum of standard of comfort, cleanliness and facilities.
The company’s network now features more than 23,000 hotels spanning more than 80 countries. It intends to channel the latest funding into US expansion.
Agarwal has increased his stake in the company from approximately 9.4% to 18% through the latest round. RA Hospitality has been cleared to invest up to $2bn in the company, debt financing raised from financial services firms Nomura Holdings and Mizuho Bank with his shares as collateral.
Vision Fund led the company’s last formal round, a $1bn round also featuring on-demand ride provider Didi Chuxing, Sequoia Capital and Lightspeed Venture Partners, taking Oyo’s total funding to $1.45bn. It was hiked by $100m to $200m from accommodation rental platform Airbnb in April.
Huazhu Hotels Group, the hospitality chain formerly known as China Lodging, invested $10m in Oyo in 2017, shortly after it had received $250m from Vision Fund, insurance and aerospace part provider Hero Enterprise, Lightspeed, Sequoia and Greenoaks Capital.
SoftBank had provided $62m the year before at a $460m valuation, after leading a $100m series B round in 2015 that included existing investors Lightspeed, Sequoia Capital India and Greenoaks. Oyo’s earlier backers also include DSG Consumer Growth and Venture Nursery.
