Read the text below.
Home-sharing platform Airbnb has invested in OYO, one of India’s largest budget hotel chains.
OYO, which means On Your Own, was established in 2013. It started as a booking platform for affordable hotels in India, but it has now evolved into a budget hotel chain. Currently, OYO has over 13,000 hotels in eight countries, including China, Nepal, and the Philippines.
Neither Airbnb nor OYO has disclosed the financial terms of the deal. Nonetheless, media sources speculate that the investment was worth around $200 million.
According to a research analyst, the partnership is strategic for both parties. For Airbnb, this move means that its future listings will also include hotel rooms on top of its regular apartment and home rental offerings. Airbnb will also have the opportunity to see further growth in China and India, two large markets where OYO has established a strong following.
For OYO, exposure on the Airbnb platform can help the Indian company break into the US market. The partnership can also aid OYO in attracting more overseas travelers. Moreover, Airbnb can speed up OYO’s expansion plans by tapping into mid-segment hotel chains that include three- to four-star hotels.
Experts find the partnership interesting because the two companies were previously seen as rivals in the industry. But with the partnership, OYO will be known as a listing supplier for Airbnb and not as a competitor.
According to several hotel consultants, this kind of partnership has the potential to be successful. Because Airbnb offers home and apartment rentals and OYO lists hotels, both companies complement each other and will have important elements to bring to the table.