Oyo is the third largest startup in India behind Paytm and Ola. The hospitality company is currently valued at over $5 billion. The company was founded by Ritesh Agarwal in 2013. It has been offering services in India, Malaysia, UAE, Nepal, China and Indonesia covering a staggering 337 cities. However, its latest venture is the company’s second in the Middle East as it ventures into Saudi Arabia after UAE. The company will be operating in 7 cities with over 3000 rooms.
Saudi crown prince Mohammad Bin Salman’s recent India visit and positive talks on increasing trade and investments have created a good picture in the minds of the Indian entrepreneurs. It is now easier for them to go to the Kingdom and expand its business there.
The travel and tourism industry will get a huge boost from the Indian company’s presence in the country. Indians have been known across the globe for their hospitality. The Sanskrit quote ‘Atithi Devo Bhava’ justifies this as it means, Guests are God. Apart from the business opportunities, Oyo has a good chance of making a good reputation of India and display India’s soft power diplomacy on the international stage.
Oyo has been receiving huge funds from major corporations across the globe such as Softbank’s Vision fund, Sequoia capital and China’s Didi Chuxing. These funds allow the company to operate well and even acquire other players in the market as well. Recently, the company is in talks to acquire the cloud-kitchen player Fresh Menu.
FreshMenu was looking for a major fundraiser and Oyo seems to have fulfilled their wish. The funding in the food company will allow Oyo to move forward in the direction of offering in-room dining services as well. Currently, the company offers only rooms and is still quite popular among travelers. If they start offering affordable foods at their rooms, the popularity will spike and their business expansion plan will see a new light of success.
Zomato and Swiggy are the largest players in the food delivery sector in India. Fresh Menu is a beginner compared to these food tech giants. However, the small player is growing and is currently delivering around 15 to 20 thousands orders. According to the Economic Times report, the company is also listed on Zomato and Swiggy where it sells almost half of its deliveries.
FreshMenu’s acquisition by Oyo will lead them to offer food in rooms as well as cloud kitchen service. As predicted by the Chinese giant Alibaba, the Indian market is opening up to the new tech-based businesses. Food tech and online grocery services are some of the newest businesses in the market. Oyo is already a great success in the hospitality market and now it is entering into the food tech industry. Oyo’s entry into the food tech industry could result in disruption.