THE OYO STORY : STARTUP TO UNICORN | RITESH AGARWAL

The story behind the emergence of OYO

In case you did not know what OYO stands for, it means On Your Own. In the modern world, it is indeed rare to find a person who does not know about OYO and the impact they have had on our society. OYO has truly become a very known name in our popular culture, thanks to the rapid expansion and influence they have had in the last decade. 

The amount of growth OYO has seen in the past decade has been phenomenal. Right now, the brand OYO has become a synonym for budget-friendly (and couple-friendly) rooms. OYO provides you accommodation services that are affordable enough, whose services they can avail from time to time. Ever since it came into the market as a shareholder, OYO as a company has been adding feathers to its cap, one after another. 

 Its founder Ritesh Agarwal has achieved the feat of being the world’s youngest self-made billionaire after Kylie Jenner in February 2020. Amid all this success, the company had to face many challenges as well.

 We all know the success the company has got but very few people know the whole story behind OYO. How was it started? How does it extend its services? What is the business model of OYO?

Ritesh Agarwal, a college drop-out, always had the intention to start something of his own. At the mere age of 17 years, in 2011, he came up with the idea of Oravel stays which was later re-launched in 2013 as, what we know today, OYO Hotels & Homes. 

There are some stories behind the setup of this platform, starting with the early life of Ritesh Agarwal.

Ritesh Agarwal was born in Rayagada, Orissa. He went to the Sacred Heart School in Rayagada. Right from his school days, Ritesh was inclined towards computers, software and coding.

Since Ritesh used to travel a lot, amid his trips, he stayed in different hotels. This gave him a realization about the poor hospitality facilities he got at different places. 

This motivated him to create an accommodation system where people can get the best rooms, food, staff, and other services in a given budget. He created Oravel Stays in 2011, an aggregator of breakfast and bed stays, inspired by Airbnb’s model. In 2013, Oravel Stays was relaunched as OYO Hotels & Homes to create India’s largest chain of affordable, standardized hotels. 

OYO did not become a success overnight. It also had to go through some sequence of events and rough phases. The company’s business was also impacted by the COVID outbreak. 

After starting in 2013, OYO went on to acquire rooms in hotels across the country and transformed them into OYO. The company’s sole aim was to make accommodation good and affordable for its people. 

OYO has continuously grown after 2013. It first started its services in India, and today, after 8 years of establishment, it operates in 800 cities in more than 80 countries of the world. 

The company started its international operations in 2018 starting with Malaysia. It then entered into the markets of the UK, UAE, Dubai, China, Singapore, Indonesia, and others.

In 2018, the company became a 100% leased & franchised hotel chain. It recorded global stayed room nights of 75 million in 2018, almost six times more than in 2017, and collected a revenue of $211 million. In 2017, 2016, and 2015 it recorded global stayed room nights of 13m, 6m, and 4m respectively. 

The company has not yet released its annual report of 2020. But in 2019, OYO generated a revenue of $951 million and witnessed an increase of 740 million dollars, 4.5 times more than 2018. 

As of now, it has acquired more than one million rooms in over 43 thousand hotels. Through its vacation homes business, the company offers travelers and city dwellers access to over 130,000 homes around the world. 

OYO now operates under the name ‘OYO Hotels & Homes’.

Like all the businesses, OYO being a hospitality company was also hit severely by the outbreak of coronavirus. Ritesh Agarwal in his address to OYOpreneurs said that the revenue and occupancy went down by over 50-60% in April 2020.

He also pointed out in the video that its global partners incurred a loss and the revenue went down by 75%. As a result, its employees had to go through a pay cut by 25%.  

Stepping out into the world in 2013, the young hotel startup, OYO Hotels & Homes, is now the world’s leading chain of Hotels & Homes, having a presence across 800 cities and 80 countries across the world. The company operates an asset-light chain of predictable, easy to book, low-cost accommodations globally and also allows its 43,000+ hotels and 150,000 vacation homes to gain from the rise in occupancy, and hence revenue.

On a global scale, OYO has started out as a leading vacation home rental platform, offering beautiful homes across Europe through its brands Belvilla, Dancenter, and Traum Feirenwohnugen. The company recently acquired TUI Ferienhaus from e-domizil GmbH that has helped OYO in becoming the second-largest global vacation home business by the number of homes.

The focus of the platform is serving its customers with dependable, sanitised, value-oriented stay experiences, which is done by simplifying booking and offering a large range of hotel options for their customers to select from in the same neighborhood, at a price that is in pace with their budget. 

In the case of asset partners, OYO offers its proprietary technology and tech-driven solutions to guarantee hassle-free operations on the ground. It provides end-to-end revenue ownership, that includes pricing, third-party distribution, and higher revenue for partners via its direct channels while also eliminating day-to-day operational hassles. 

When it comes from the perspective of the company’s employees, OYO is a workplace that allows thousands of talented professionals the opportunity for achieving their full potential. There’s never a dull day for OYOpreneurs. From solving complex issues and enjoying the opportunity of collaborating with the best global talent, they can in turn seek to make their own mark. 

Team

The Successlogy