Update: Airbnb confirmed this investment on April 1
We told you Airbnb had some cash, and time, to burn before its IPO.
Coming off of an acquisition of last-minute booking company HotelTonight, Airbnb is eyeing another hotel startup, this time with the intention of investing. According to The Information, Airbnb may soon back OYO, an Indian hotel startup. The investment would be between $100 million to $200 million, Cory Weinberg reported.
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OYO, which says it’s “India’s largest hospitality company” helps manage budget hotels in India. It markets its rooms through Airbnb competitors like TripAdvisor and Booking.com, The Information reported. OYO claims it is currently in 964 cities in India, Nepal and Malaysia and has over 8,500 properties.
Notable investors in OYO include Sequoia Capital, Didi Chuxing and SoftBank Vision Fund, which our EIC Alex Wilhelm wrote about in September. OYO reached out to Crunchbase News to say that “global strategic relationships” like Airbnb, and other regional and global players, support their mission. However, they are not exclusive to one partner as of now. OYO did not confirm that Airbnb is in talks to invest in it.
While Airbnb’s potential investment is noteworthy, it pales in comparison to Softbank Vision Fund’s patterned checks to the hotel company. According to Crunchbase, Softbank led the company’s Series B, Series C and Series D. And in September, Softbank led a $1 billion investment into the company in Series E.
So as Alex put it: OYO is a SoftBank-fueled affair.
Circling back to today’s news, however, Airbnb has been on a spree of both investments and acquisitions – so this potential one isn’t a surprise. In 2019 alone, the company acquired both HotelTonight and Gaest.
In the chart below, you can catch up on Airbnb’s known acquisitions over time.
Airbnb’s most recent investment, according to Crunchbase data, was in December 2018: it participated in a $75 million Series C in female-focused co-working space The Wing. Most recently, its investments have been social-impact focused, including grants to New York State Rural, CSNYC, and Women In Need.
Bottomline: If the OYO deal goes through, it’s the first investment Airbnb has made in over a year in a company that also focuses on travel experience. This tells us that Airbnb is continuing to buckle down on self-interest and growth ahead of its potential IPO. More and moves in this direction are likely to follow suit. Let the cashing, and time burning continue.
Editorial Note 3/20/2019: This article has been updated with a statement from OYO.
Illustration: Li-Anne Dias