Boosting Valuations

With the latest round of investments worth $1.5 billion in Oyo Hotels and Homes, the homegrown chain has caught everyone's attention. Oyo, which was started by Ritesh Agarwal over six years ago, has seen valuation going up to $10 billion after the recent investment - that's a big jump for a start-up that was valued at $5 billion last September when it had raised $1 billion from Japan's SoftBank and others.

SoftBank's entry into Oyo was a turning point for the hotel chain, which has put the pedal to the metal ever since by expanding base in geographies like China and the US, and getting into newer segments, apart from strengthening its presence in India. The latest funding round, where Agarwal is buying back shares worth $700 million, seems like an effort to boost valuations, especially at a time when the start-up's largest investor SoftBank is battling to generate returns on its $100-billion Vision Fund-I (due to issues with its investments in Uber and WeWork), and raise money for its second Vision Fund.