Hospitality unicorn OYO has raised an undisclosed amount from Swedish billionaire Martin HP Soderstrom who is also the chairman of DIG Investments. With this investment, Soderstrom will also join the board of OYO’s European vacation homes business, and drive the company’s M&A focus in the continent
Last week, the company had raised INR 54 Cr (over $7.5 Mn) from HT Media-owned Hindustan Media Ventures as part of the Series F1 round.
Besides working with the top management of OYO to drive continued and sustainable growth in the company, Soderstrom is expected to provide guidance on potential M&A opportunities. He “would also assist the organization in building deep strategic partnerships with other leading, EU-based companies and lay out its brand positioning strategy as a thought leader in the vacation rental space,” the company added.
This comes after the company recently laid off employees in the aftermath of the business slowdown during the pandemic and the drop in revenue. The company claims to have 43K hotels and 1.5 Lakh holiday and vacation homes in over 800 cities in 80 countries.
OYO Vacation Homes, which would be Soderstrom’s primary focus, claims to have over 50K homeowners, 140K homes in 70 countries worldwide and 2.8 Mn guests annually. In a report in WSJ last week, the company had claimed it has $1 Bn in cash and cash equivalent to navigate the post-pandemic market.
OYO founder and CEO Ritesh Agarwal said, “I am elated to welcome him (Soderstrom) as an investor and a fellow board member at OYO Europe. He has a proven track record of investing and growing tech-focused businesses in India and globally with immense knowledge about the Asian and global entrepreneurial and investment ecosystem.”
Prior to its latest fund raising, OYO had raised $806.75 Mn funding from existing investors SoftBank and founder Ritesh Agarwal owned RA Hospitality Holdings in March 2020, in what was a share buyback move. The investment is the first tranche of the $1.5 Bn Series F round, which was announced in October 2019.
In September 2019, Agarwal had said that he would be buying back shares worth $1.5 Bn from the company’s investors Sequoia Capital and Lightspeed Venture Partners. Agarwal and OYO had received a go-ahead from CCI for the share buyback and to infuse $500 Mn further into the company.