Oyo Hotels and Homes Ltd. CEO Ritesh Agarwal, one of the country’s youngest billionaires, shared a tweet from his official Twitters account on Tuesday. In the tweet, the entrepreneur offers a little piece of advice for his fellow contemporaries and aspiring entrepreneurs alike. The 27-year-old CEO, who started his business journey with Oyo stated that in his initial days, around 80 per cent of the venture capitalists that he approached rejected his company. The tweet read, “During my early days at OYO, nearly 80% of the VCs I wrote to rejected me. As an entrepreneur, you are going to face rejection most of the time, get used to it. But the few moments where people are willing to give you time, are the ones that matter. Make the most of them.”
He took to social media to inform his fellow entrepreneurs to be patient in their business ventures as the majority of the journey consists of rejections. Agarwal had started Oyo before he even turned 20-years-old. By 2018 the company had raised its first $1 billion from Japan’s SoftBank Vision Fund as well as other investors. Within six years of establishment, the company had earned the elusive Unicorn status.
Recently, the chain of hotels and homes had been hit hard by the pandemic and the employees were some of the worst affected by this. The lockdown brought to light the stress that existing labour laws put on workers in the tourism industry. To compensate for this, in May of 2021, Oyo came out with a four-day work-week for all of its employees. Oyo also rolled out unlimited paid leaves for its employees till the month of July.
In Early April of 2020, when the pandemic was raging through the country, the entire executive leadership team took a voluntary pay-cut that ranged from 25 to 50 per cent. For the entirety of the year, even Agarwal chose to forego on 100 per cent of his salary. During the initial 21-day lockdown that took place, the 10,000 plus OYOpreneurs on payrolls along with tens of thousands of OYO managed assets staff continued to receive their salaries with benefits.
In a letter to employees in January of 2020, the CEO of the hotel chain said, “One of the implications of the new strategic objectives for 2020, is that, like the leadership team, we will reorganise more teams across businesses and functions. As a result, we are asking some of our impacted colleagues to move to a new career outside of Oyo.”
On Friday, the hospitality unicorn managed to raise debt funds worth $660 million from its global institutional investors, one of which was Fidelity Investments. Oyo raised this funding via the term B loan (TLB) route. The company intends to put these funds to use by strengthening its balance sheet as well as investing in product technology. The offer was oversubscribed by 1.7 times and it also received commitments of close to $1 billion from the leading institutional investors, a PR Newswire press release said.
Abhishek Gupta, Group Chief Financial Officer, OYO, said “We are delighted by the response to OYO’s maiden TLB capital raise that was oversubscribed by leading global institutional investors. We are thankful for the trust that they have placed in OYO’s mission of creating value for owners and operators of hotels and homes across the globe. This is a testament to the strength and success of OYO’s products at scale, our strong fundamentals and high-value potential. OYO is well capitalized and on the path of achieving profitability. Our two largest markets have demonstrated profitability at the slightest signs of industry recovery from the COVID-19 pandemic."