Team Name : Innovators

Members :
Nishant Kishlay
Vishal Yadav
Sachin Kumar
 About OYO
• 2011- Ritesh Agarwal, an 18-year-old college dropout, seemed to harbour dreams of entrepreneurship which compelled him
to take the plunge with his first start-up Oravel. Oravel enabled listing and budget accommodation of hotel rooms and it, later
on, got converted to become Oyo rooms.
• 2013- Agarwal was also selected for Thiel Fellowship, a 2-year-old program started by the founder of Paypal which gave him
funding of $100,000 to pursue and make real the idea of his start-up. Oyo was launched in Gurgaon.
• 2014- In August of this year, Oyo received its first Series A funding.
• Becoming the Face of Indian Start-ups
• 2015- In March of this year, Oyo received funding of a whopping amount of $25 million from its investors namely Lightspeed
India, Seqoiua and others.
• April 2015- Oyo app was launched. The mobile app was a catalyst in writing the success story of this hotel chain start-up that
was to follow. It is a user-friendly app that helps customers to book rooms directly. It has almost come up to 2000 hotels,
20,000 rooms and 100 cities in India.
• July 2015- Oyo bagged $100 million in Series C Round of funding from Japanese investor SoftBank. This year proved to be a
financially fulfilling year. Oyo now had the backing of one of the most prominent and powerful investors in the world.
• 2016- In January, first month of the year itself, the hotel chain hit the 1 million check-ins mark and also made an advent
outside India into the Asia Pacific market, beginning with Malaysia.
• 2017- Continuing its expansion aspiration, it launched a business in Nepal. Nepal and Malaysia was just a hint of the
monstrous development that was to follow.
• Conquering the Asian Territory and Stepping into the International Markets
• 2018- This is the year that marked the establishment of the Oyo empire in Asia-Pacific and kick-started international
proliferation by establishing operations in UK, UAE, Dubai, China, Singapore and Indonesia. It also became a unicorn in
September when it raised funding of $800 million from SoftBank and along with $200 million from its existing investors.
• 2019- With the backing of Greenoaks, Sequoia India, Lightspeed India, Hero enterprise and China Lodging Group as its solid
group of investors, Oyo is not far from becoming a global success story, perhaps to some extent it has. Today it has more than
330,000 rooms in 500 cities globally. And Agarwal, still young and who has a long way ahead plans to make it the world’s
largest oldest chain by 2023!
OYO Strategies:
Only after 5 years of establishment, OYO has expanded in more than 330 cities. OYO did not achieve success overnight, Oyo
works hard to get this success. Here are the 4 strategies that made OYO successful:
1. Assets Light strategy:
OYO implemented is assets light strategy and doesn’t own a hotel but takes them on lease and invest a small amount of money to
make it as per the standard of the company. This strategy is popular among startups because the business only has to own fewer
capital compared to the value of its operation. Small hotels were 90% vacant and nobody was going there, OYO partnered with
these small hotels instead of building them. Its saves huge amount of money for the OYO room.
2. Takes full responsibility for Customer experience:
OYO takes the end to end responsibility of customer experience and considers all the requirements that the customer may have.
Customers can have requirements such as Searching hotels, booking hotels, easy check-in, easy checkout, and world-class
experience. OYO spends a small amount of money to change the look and feel of the hotel for better customer experience.
3. Focus on Predictability:
OYO realized that data is an important element to gain and satisfy customers. OYO collects the data from the consumer and
understand what are consumer likes and dislikes. OYO is focused on making the consumer of the service and create repeatability
through predictability in service.
4. Use of technology for Speed and Scale:
OYO is focused on making a user-friendly mobile application. Through the app, the user can book a room in just 3 clicks. The
company created an app for customers and for its partners. Oyo wants to minimize the use of human resources through
technology. OYO also created a dedicated team of data science and looking forward to investing more money in innovation and
Research & Development.
Change of business model
Oyo Rooms Franchise Model
Oyo charges hotels a roughly 20% franchise fee on room revenues when hotels join its network, but some Indian
hotel operators say the startup often ends up taking half or more of revenues through fees that were not initially
disclosed.

In the last year 2018, OYO Hotels & Homes completed its transition to becoming a 100% leased & franchised hotel
chain. Following this, the entire hotel is renovated as per OYO brand and quality standards with Capex invested in
assets primarily by asset owners to deliver core promises to our customers and ensure higher returns to asset
owners.

• In 2016, Oyo pivoted to a 100% franchise model, which meant that while a hotel isn’t owned by Oyo, it controls
the operations of the hotel, managing and running the hotel in a standardised manner.
• Aggregator business model of OYO Rooms naturally added up a lot of operational costs and required huge working
capital to first block those rooms.
• This model was effective, but OYO was getting only 22% of the revenue generated.
• OYO’s plan to shift from hotel aggregation to franchise model came mainly to reduce its operational costs and to
improve serviceability.
• This has helped also improve customer experience.
 Sustainable Growth Plans
• OYO Hotels & Homes has emerged as the world's second-largest hotel, and fastest-growing chain of hotels, homes,
living and workspaces, leaving behind several traditional and long-standing hospitality brands.
• In a short span of six years, OYO has expanded its presence to 80-plus countries around the world. This fast-paced
growth is fueled by the company's success in China, followed by fast-paced growth in Indonesia, the UK, and more
recently in the US.
• Oyo, is doubling down on its expansion plans and taking aim at the U.S. after growing its presence in a number of
markets in broader Asia. Ritesh Agarwal is forecasting the occupancy rate of its U.S. hotels — once rebranded — to
rise to 70% to 80% from 35% to 40%.
• Over the past two years, Oyo has spent hundreds of millions of dollars buying hotels in the US and Europe, and has
established itself as the second-largest hotel chain in China. In its home market, Oyo had established near-
complete dominance, leaving rivals Treebo and Fab Hotels far behind
• Oyo started OYO Life’s and strengthened it’s footprint in the country with 40,000+ live beds and 700+ live
buildings across 9 cities – Delhi, Noida, Gurgaon, Pune, Bengaluru, Mumbai, Hyderabad, Chennai, and the latest
edition being Kolkata. Tapping into the potential of the student housing sector OYO recently signed an agreement
to provide 500+ beds for students of both IIT and PLAKSHA TECH Leaders Fellowship in Delhi and Gurgaon
respectively to provide affordable accommodations.
• The rental market is pegged at $50 billion and has huge opportunities as there is a supply-demand gap in the long-
term rental housing.
• The firm recently acquired co-working venture Innov8, plans to expand the business to 50 centres by the end of
the current financial year. It currently operates 38 centres across 10 cities totally to 25000 seats.
Customer & Operational Excellence
• Oyo launched OYO LIFE in October 2018 with the aim to offer an end-to-end managed, comfortable,
high-quality living experience to millennials and young professionals, eliminating their hassle of
discovering, accessing and managing everyday housing.
• Unlike aggregators in the industry, OYO LIFE lease an entire building, transform it, control its inventory
and manage the end-to-end operations to offer a superior co-living experience, replete with break-out
zones and community gaming and interaction areas. Starting at an affordable price of INR 5,999 per
bed, all of our OYO LIFE buildings are equipped with essential amenities like Wi-Fi connectivity,
television, refrigerator, furnishings, AC, regular housekeeping, power backup, CCTV surveillance, and
24/7 caretaking.
• OYO LIFE addresses the supply-demand gap in the long-term rental housing space and eliminates the
hassles of heavy deposits, lock-in period, lack of safety infrastructure, unpredictable living conditions,
expenses on furnishings, maintenance and unreliable housekeeping.
Profitability
• According to the company filings accessed by Inc42, first reported by Paper.VC, OYO reported a loss of INR
2384.69 Cr, a 5.5X jump from its losses of INR 360.42 Cr of FY18. The valuation report shows that the
company has increased its expenses by 3.9X in FY19 with a jump in revenues by 3.5X.
• n terms of revenues, Oyo's operational revenue grew to INR 6456.9 Cr in FY19, a jump of 3.56X from INR
1413 Cr in FY18. At the same time, Oyo's operational expenses were INR 6131.65 Cr in FY19, a 3.9X increase
from INR 1246.8 Cr in FY18.
• One of the biggest jumps came in employee benefit expenses which reached INR 1538.85 Cr in FY19, from
INR 266.3 Cr in FY18.
• The company is expecting $285.9 Million in losses for 2020, but aims to turn a profit of $45.2 Million in 2022.
• The valuation report shows that Oyo's India business has been valued at $1.18 Billion, china’s business at
$991 Million, Japan’s business at $256.7 Million and the rest of the world including USA, Germany, France
and others at $1.21 Bn.
Governance of the organization
• OYO announced the elevation and addition of Aditya Ghosh, presently CEO, India & South Asia for the hotels
and homes business to the company’s Board of Directors. Aditya is joining Ritesh Agarwal, Founder & Group
CEO, OYO Hotels & Homes, Betsy Atkins, Founder & CEO, Baja Corporation and other industry experts
like Munish Varma, Managing Partner, SoftBank Vision Fund, Bejul Somaia, Partner, Lightspeed India Partners
Advisors, Mohit Bhatnagar, Managing Director, Sequoia Capital India Advisor among others, making it a
powerful, diverse, and truly global combination.
• The recent appointment of independent director, Betsy Atkins on the Board, who earlier invested in Yahoo
and eBay and now Aditya, who hails with a depth of experience in running successful public companies, will
both tremendously benefit the company.
• In the last six+ years, OYO has consistently built a culture of innovation and meritocracy supported by the
organisational tenet of distributed leadership that empowers and expedites independent decision-making.
OYO has not lost a single leader while continuing to attract top talent from the world over.