SoftBank Vision Fund leads $250m round for India's Oyo

Existing investors Lightspeed Ventures, Greenoaks Capital, and Sequoia India also participated in the funding round, along with newcomer Hero Enterprise. The company will use the new capital to enter new markets in Southeast Asia, build its team and improve its technology backend.

Oyo was launched in 2012 as Oravel.com, a marketplace for travelers planning short and mid-term holiday trips to book boutique hotels and serviced apartments. The original site was shut down and renamed Oyo in 2014, and the parent company changed its name to Oravel Stays.

While Oyo has retained its core budget hotel aggregation business, it is also exploring other ventures. The company’s recently launched Oyo Townhouse follows a business model similar to that of domestic competitor Fabhotels, offering managed accommodation at properties leased and managed by Oyo. The approach provides a premium experience for customers with more monetization opportunities for the company.

“In less than four years, OYO has become India’s largest hospitality company in terms of network presence and inventory,” said Ritesh Agarwal, Oyo’s founder and CEO. “We are now focusing on further accelerating network coverage and will also deploy fresh capital to take our business model to international markets which are characterized by a similar supply-demand imbalance in real-estate and hospitality.”

SoftBank has been a significant backer of Oyo, leading the company’s $100 million Series B round in 2015 and investing another $62 million the following year as the initial tranche of a larger Series C round. Greenoaks, Lightspeed and Sequoia participated in both rounds, with DSG Consumer Partners joining the Series C, according to AVCJ Research.

SoftBank Vision Fund reached a first close earlier this year of more than $93 billion, and is planning a final close of $100 billion before the end of the year. The fund targets minority and majority positions in private and public companies, ranging from start-ups to established businesses. Investments by the vehicle so far include a $2.5 billion commitment to Indian e-commerce giant Flipkart and a $4.4 billion commitment alongside its parent company in US-based co-working space operator WeWork.

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• Topics
• South Asia
• Consumer
• Technology
• Expansion
• India
• Softbank
• TMT
• Lightspeed Venture Partners
• Sequoia Capital