Budget hotel brand OYO is in talks with China’s internet giant Tencent to raise $300-$500 million funding at a valuation of over $2 billion, according to news reports. If the deal comes through, OYO would be the fifth company to join the unicorn club this year.
In the last round of funding of $250 million in 2017, the Gurugram-based company was valued at $850 million. That time SoftBank had invested through its Vision Fund.
This would be the second time Tencent and SoftBank are investing together in India. The first one was in a ride-hailing firm Ola. Masayoshi Son-led SoftBank has preferred to invest till in four companies – including Paytm, Paytm Mall, Snapdeal – with Alibaba .
Recently, OYO launched its operations in China. The company plans to utilise the new funds for its expansion in the Chinese market. Oyo also has presence in UK, Dubai, Malaysia and Nepal.
Besides Softbank, company is also backed by investors like Lightspeed Venture Partners, Sequoia Capital, Hero Moto Corp, and Greenoaks Capital among others. It operates in three categories – the aggregation business brand OYO Rooms which contributes 90% of its revenues, along with Townhouse and Flagship, where the company leases properties and services them for a better quality experience.
Other companies which crossed a $1 billion valuation this year are Paytm Mall ($1.9B), Byju’s ($1B), Swiggy ($1.3B) and PolicyBazaar .