OYO Rooms an Indian Startup having a large network of hotels which operates in more than 160 Indian cities including Ahmedabad, Delhi, Gurgaon, Jaipur, Mumbai, Bangalore, Hyderabad, Goa, Chennai, Kolkata, and others. Its present in major metros, regional hubs, leisure destinations and pilgrimage towns. According to a research carried out by CB Insights for The New York Times, OYO Rooms has been deemed as one of the upcoming start-up unicorns. The company is backed by investors like the Softbank Group, Greenoaks Capital, Sequoia Capital and Lightspeed India.
The company’s CEO and Founder, Ritesh Agarwal, announced OYO’s launch in Malaysia through a post on the company’s official blog in Jan 2016.
Ritesh Agarwal, an entrepreneur born on November 16, 1993 was raised in a middle-class Marwari family. He went to Sacred Heart School in Rayagada, Odisha. After finishing class 12th, he enrolled in Indian School of Business & Finance, Delhi. However, he didn’t continue with his college education and dropped out to start his own company without his family knowing of this move. He has often talked to the media about how he was scared of his parents getting to know that he has dropped out of college.
In an interview with the Economic Times, Agarwal said, “When the newspapers started reporting it. My dad came to Delhi and was perplexed to see the office. It took me a day to convince him. My mom was very unhappy because she felt who would take me for a groom? You needed to be at least a graduate.”
He travelled extensively across India at the age of 17. His various stay experiences at budget accommodations inspired him to launch Oravel Stays in 2012, which was modelled after Airbnb. Later he changed Oravel into OYO Rooms. In the same year he was selected for the Thiel Fellowship. The fellowship created by PayPal founder, Peter Thiel, provided $100,000 to the college drop-outs under 22 years of age to pursue their idea.
He acknowledged himself by earning a lot of accolades, i.e., First resident Asian to win Thiel Fellowship, 2013, Top 50 Entrepreneurs in 2013 by TATA First Dot powered by NEN Awards, Named as one of the ‘8 Hottest Teenage Start Up Founders in the World’ in 2013 by Business Insider, TiE-Lumis Entrepreneurial Excellence Award in 2014 and Business World Young Entrepreneur Award in 2015.
Its HeadQuaters is located at Unit-325, 3rd & 6th Floor, B-2 Tower, Spaze I-Tech Park, Sohna Road, Sector 49, Gurgaon, Haryana 122002.
Business Model of OYO Rooms
OYO Rooms is a branded network of hotels. OYO partners with hotels with the aim of standardization on various measures in each room including free WiFi and breakfast, flat-screen TVs, spotless white bed linen of a certain thread count, branded toiletries, 6-inch shower heads, a beverage tray and so on. The standards are audited every few days so that the customers are assured of a quality experience. OYO’s budget stays range from 999 ($16) to 4000 rupees ($66). OYO provides property owners with support such as quality standardized supplies and service training. The company will use funding to realize its ambition of becoming the largest technology-enabled network of hotels globally. OYO Rooms leverages technology and enables consumers to have hassle-free budget hotel booking experience while it helps hotels/guesthouses to increase their occupancy.
KEY VALUES of OYO Rooms
Kavikrut, Chief Growth Officer at OYO confirms that they are rapidly expanding and bringing in a large number of hotels under their brand name. A quick search for Delhi returns 223 hotels. In Bangalore, they have 154 and 59 in Ahmedabad. They also have a presence in holiday destinations such as Ooty, Alleppey or Darjeeling, though in much smaller numbers. The rapid expansion has been possible by working with existing budget to mid-range hotels and branding them as OYO. The hotels are managed by the property-owners according to a given set of standards and are marketed by OYO. According to Kavikrut, having a large number of choices ensures guaranteed availability–one of the four key values that OYO intends to provide. Others being affordability, accessibility and predictability.
A considerable number of their accommodations are priced at Rs.999. On the higher side, prices rarely go beyond Rs.3,000. OYO intends to work with properties within this budgets range in large cities, while they may add more expensive accommodations in leisure holiday destinations.
HANDS ON SERVICE
OYO Rooms had recently launched its mobile app that promised a hotel room booking in less than 10 seconds. The OYO Rooms mobile app is also the world’s first personal room service app that allows guests staying at an OYO to order room service directly from their smartphones. The app has already crossed more than 100,000 downloads within a month of its launch. Available on Android and iOS platforms, more than 15,000 bookings have been made through the OYO Rooms mobile app within a week.
OYO Rooms Vision
Abhinav Sinha, COO of OYO Rooms said, “OYO Rooms started this segment and is ahead of other players who have recently entered this space. We are the pioneers in bringing the comfort and experience of an expensive hotel at a really affordable price and use technology to enhance customer experience. That is why most of our branded hotels witness more than 80% occupancy and our customers love us. It is their trust in us that has given us the confidence to continue to grow at such a rapid pace.”
OYO Rooms Funding
OYO Rooms got its first round of funding from Venture Nursery in December 2012. Then another round of funding came from Lightspeed Ventures in February 2014. In March 2015, OYO Rooms raised $25 million from Lightspeed, Sequoia and others. After that in July 2015, OYO Rooms raised $100 million from SoftBank. The group has led an investment of $100 million (Rs 630 crore) in budget-hotels marketplace OYO Rooms.
(The new funding announcement is Japanese major’s fourth investment in India in the last 12 months. SoftBank has made around $1 billion investment in the country’s top tier online retailer and taxi hailing start-ups like Snapdeal, Ola and real estate player Housing.com.)
OYO will use the fresh capital rose to implement customer experience initiatives, build technology products and expand in the hotel industry.
OYO Rooms Module
OYO streamlines the procedure of processing reservations with an online reservation system with the following modules:
Increasing the security and confidentiality of each files and report by providing a security module, a log-in form that will have. Also, the levels of access. The first will be the administrator of the system and the customer for the second level of access. Each will have a unique username and password thus making the system more secured not only for the company but also to other users of the system. Only the registered members of the system will have the privilege of reservations of rooms and events, thus restricting unregistered members from reserving/booking a room or event, making their system more organized and efficient.
And, the system will provide a monitoring module that will display an overview of the system which is accessible only to the admin. With this the admin can easily view which dates are available or unavailable for any event reservation, this will also indicate which room/function halls are available for reservation. Furthermore the system will also provide an organized view of confirmed reservations, pending reservations, incomplete reservations and user’s overview and since it is computerized and done in real time, every reservation done will automatically be counted and will display the remaining available dates and room/function halls.