Indian hotel startup OYO is now worth $10 billion

Ritesh Agarwal will invest $700 million into OYO as part of the company’s new $1.5 billion fundraising round, with existing investors including Japan’s SoftBank (SFTBF) putting in the rest, OYO said in a statement Monday. He’s also buying $1.3 billion worth of existing shares from early investors Lightspeed Venture Partners and Sequoia Capital, with support from “banks and financial partners,” a spokesperson said.

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Agarwal, 25, founded OYO in 2013, taking over the operations of budget hotels across India and rebranding and renovating them for a fee or revenue share. The company quickly became the dominant player in India’s hospitality industry and has now set its sights on an ambitious global expansion.

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The latest investment takes Agarwal’s stake to 30% and values OYO at $10 billion, according to a person familiar with the matter. That makes it India’s second-largest startup after digital payments company Paytm, which also counts SoftBank as one of its biggest investors and is currently valued at around $15 billion.

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“We truly believe that we will be able to build a truly global brand out of India, while ensuring that the business is run efficiently and with a clear path to profitability,” Agarwal said in a statement.

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OYO confirmed that the founder’s stake in the company has increased, but declined to comment on the size of it. The company also declined to comment on its latest valuation.

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OYO will use most of its new investment to further its expansion into Europe, where it bought vacation rental company @Leisure earlier this year, and the United States, where it has signed on Airbnb as an investor and recently bought the Hooters Casino Hotel in Las Vegas.

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It currently operates in 800 cities across 80 countries, including the United States, United Kingdom, China and Japan.

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