Site icon Protechbro: Top Stories on Bitcoin, Ethereum, Web3, & Blockchain

Oyo Rooms Securing New Funding Worth Up to $2.5 Billion

Oyo Rooms Securing New Funding Worth Up to $2.5 Billion

Oyo Rooms Securing New Funding Worth Up to $2.5 Billion

Oyo Rooms, an Indian budget hotel chain startup, is currently working on securing more funding worth about $2.5 billion.

Two individuals who know the situation have informed TechCrunch that Oyo, the Indian budget-hotel chain startup, is finalizing a new financing of approximately $100 million to $125 million, reducing its valuation to $2.5 billion.

This represents an abrupt decrease in the Gurgaon-based startup’s value, valued at $10 billion in 2019. In recent months, the startup has been making a concerted effort to approach high-net-worth individuals, as it has been experiencing difficulty in securing funding from institutional investors.

“We genuinely believe that this asset is highly beneficial today.” Profitability and a 70% discount from the previous valuation. In a message (which was viewed by TechCrunch) to a startup founder, a representative of InCred, a financial firm collaborating with Oyo, stated that the listing is anticipated to occur within the next 18-24 months.

Earlier last month, TechCrunch reported that Oyo was in the process of raising funds at a valuation of $3 billion or less. Oyo categorically refuted the “rumors,” which included the valuation, at the time. The sources above, who requested anonymity because the matter is not public, predicted that the new round will expand in size.

Following the cancellation of its IPO proposal last month, Oyo has secured additional funding. SoftBank, Peak XV Ventures, Lightspeed, Airbnb, and Microsoft are among the companies that have supported the startup, which has withdrawn its IPO application from the Securities and Exchange Board of India twice in the past four years.

In 2021, Oyo submitted documentation to SEBI for a public listing; however, it was withdrawn and resubmitted in 2023. The company, which has raised more than $3 billion to date, aimed to raise $1.2 billion at a valuation of $12 billion in the 2021 IPO.

Oyo was once one of the most popular Indian startups and now maintains an operating system that assists hoteliers in accepting digital bookings and payments. The venture was previously operational in numerous markets, including the United States and Europe; however, it has since reduced its international presence.

According to founder and CEO Ritesh Agarwal, the organization generated a net profit of $12 million during the fiscal year that concluded in March.

In 2019, Agarwal increased his stake in Oyo, valued at $10 billion at the time, by assuming a $2 billion debt. The primary capital he invested in Oyo was $700 million, and he spent $1.3 billion on a secondary purchase of Oyo shares. Since then, the startup has refrained from providing an update on the debt status.

The Indian newspaper Economic Times also reported on the new financing on Monday, stating that the startup will consult with its existing shareholders to obtain approval for the funding this week.

Exit mobile version