OYO acquires Innov8, moves into co-working business with two more brands
SoftBank-backed hospitality unicorn OYO has officially announced its foray into co-working business with the acquisition of Delhi-based co-working space provider Innov8.
OYO will follow a multi-brand model with three co-working brands - Innov8, Powerstation and Workflo – to cater to upper midscale, midscale and economy co-working markets, respectively, the company said in an official statement today.
OYO Workspaces currently has 21 centres offering over 15,000 seats across 10 cities in India, the statement added.
Innov8 is currently operational in six cities - Delhi, Noida, Gurugram, Bengaluru, Chandigarh and Mumbai - with 16 centres hosting over 6,000 employees of brands like Swiggy, Paytm, Pepsi, Nykaa, and OLX.
Powerstation has one centre in Gurugram with over 1,000 seats. Workflo has four centres across NCR, Hyderabad and Bengaluru with a hosting capacity of over 1,500 seats, the company said.
The Gurgaon-based company said it will expand its co-working business to over 50 centres across India by the end of 2019.
“Through a targeted multi-brand strategy, we aim to provide a differentiated experience for co-workers at different price points and help expand access to co-working spaces to more and more businesses and professionals across the country,” Rohit Kapoor, CEO, new real estate businesses, OYO, said.
“Given our experience in the hospitality industry and investment in core competencies that have helped us scale so fast in the hospitality, housing rental and banquet services business, we believe we are uniquely placed to leverage to create a strong offering for the corporates looking for space as a service.”
While OYO did not disclose the financial details of the Innov8 acquisition, media reports have pegged the deal value at $30 million (Rs 206 crore at the current exchange rate).
Operated by Guerrilla Infra Solutions Pvt. Ltd, Innov8 was founded in 2015 by Ritesh Malik and IIT Kharagpur graduate Shailesh Gupta.
Innov8 was selected by Silicon Valley-based incubator Y Combinator for its summer 2016 batch.
The following year, the company raised angel funding led by online deal-making platform LetsVenture and Mumbai-based seed investment platform Venture Catalysts. The round saw participation from Paytm founder Vijay Shekhar Sharma, Google India head Rajan Anandan, Freshworks founder Girish Mathrubootham as well as Punit Soni and Anand Chandrasekaran, former product heads at Flipkart and Snapdeal, respectively.
It raised $4 million in a pre-Series A round of funding, led by Credence Family Office in October last year.
Oravel Stays Pvt Ltd, which operates OYO Hotels and Homes, claimed last week that it is the world's third-largest hotel chain as per room count at the end of June 2019.
The hospitality chain made its foray into China in June 2018 and went on to become the second-largest hotel chain in China in less than a year.
OYO Hotels and Homes entered the markets of Indonesia and Vietnam to capitalise on its momentum in the Asian market and expand its presence in south-east Asia.
The hospitality unicorn had announced in March that it planned to put in $200 million to expand its foothold in the south-east Asian market.
In April, the hotel chain announced plans of entering the Japanese market in partnership with SoftBank.
Oravel announced last month that it was planning to invest $300 million in the US to expand its presence in North America.
The recent acquisition of @Leisure has further helped the company strengthen its leadership in the vacation home segment in Europe.
The company claims to be operating in more than 800 cities in 80 countries, including the US, China, Europe, the UK, India, Malaysia, Indonesia, the Philippines, Japan and several cities in West Asia.
OYO Hotels and Homes has got funding from Airbnb, SoftBank Vision Fund, Greenoak Capital, Sequoia Capital and Hero Enterprise.