Airbnb is gearing up for its IPO and has made strategic moves to build its market value. In March, it announced the acquisition of HotelTonight, and on the 1st of April, it confirmed its investment in its Indian rival, OYO — a startup that manages budget hotels and other stays.
The deal comes after OYO raised $1 billion in Series E, with an evaluation of $5 billion. Overall, it has raised $1.5 billion till date, excluding the most recent deal with Airbnb. While the investment has not been confirmed by any party, an industry source said it to be between 150-200 million.
Airbnb is growing its portfolio of services, and with the two recent deals, has shown an appetite to become the booking destination across different verticals. The deal with OYO is also geographically strategic, as the Indian market is one of its top five fastest growing markets.
Naturally, the deal gives both parties strategic advantage, as Airbnb gets a larger market share and OYO gets the exposure it needs to expand further overseas.
Fun fact: OYO’s founder Ritesh Agarwal founded the company in 2011 under the name Oravel, which was an Airbnb clone — it later pivoted to OYO.
Learn more about the deal and what the Airbnb and OYO had to say here.