After being in controversy for months, branded network of budget hotels OYO Rooms has raised over $25 Mn in a funding round led by San Francisco-based Greenoaks Capital and existing investors i.e. Lightspeed and Sequoia at a valuation of $100 Mn.
OYO, had previously raised funding from VentureNursery, a seed round from Lightspeed Venture Partners and DSG Consumer Partners last year, and later it raised INR 30 Cr. from Sequoia Capital in October.
College dropout Ritesh Agarwal, had launched this startup three years back, as Indian version of home-sharing website AirBnB. But, later, it had pivoted its business model to a managed marketplace of branded and standardized budget accommodations under the brand OYO Rooms.
The startup has been growing aggressively since past 6 months, and from 30 hotels it has added over 200 and from one city to 10.
Going further, by the year end, it plans to add over 1000 hotels.
“We believe OYO Rooms has an incredible opportunity to solve major pain points for hotel owners and customers by building a consistently great experience in the budget hotel space,” said Neil Mehta, managing director of Greenoaks, who is also an investor in India’s largest online marketplace Flipkart.
OYO, recently also got into trouble when it was found violating its competitor, Stayzilla’s trademarks on Google ads. Oyo had used Stayzilla’s trademark and brand name on Google Adwords copy to steal the traffic, which is not only a trademark violation but even violation of the Google’s advertising policy.
— Stayzilla.com (@stayzilla) March 20, 2015
Based out in Gurgaon, OYO was also part of VentureNursery accelerator program’s first batch and had also received a $100,000 grant as part of 2013 Thiel Fellowship program in October 2013.