Microsoft backs India’s Oyo at $9.6 billion valuation

Microsoft has invested $5 million in Indian finances resort chain Oyo, primarily based on a regulatory filing this week. The funding confirms a TechCrunch scoop from closing month.

The unique funding values Oyo at $9.6 billion, utterly somewhat below the $10 billion implied valuation from the Indian startup’s outdated financing spherical in 2019. The startup, which misplaced significant enterprise to the pandemic, used to be valued at gorgeous $3 billion in most up-to-date quarters by SoftBank, one of its top traders.

TechCrunch reported earlier that this strategic funding might per chance per chance furthermore maintain Oyo shifting to make exhaust of Microsoft’s cloud companies and products. The company is planning to file for an IPO later this year, primarily based on two other folks acquainted with the matter.

Oyo, which is one of India’s most treasured startups, has aggressively expanded to many markets alongside side Southeast Asia, Europe and the U.S. in most up-to-date years.  But some of its missteps — “poisonous tradition,” lapse in governance, and relationship with many resort owners — beget scarred its development.

Correct because the startup used to be pledging to toughen its relationship with resort owners, the pandemic arrived. In response, Oyo slowed its development and laid off thousands of employees globally earlier this year as countries all over the arena enforced lockdowns.

The pandemic hit the seven-year-veteran startup cherish a “cyclone,” Agarwal instructed Bloomberg TV closing month. “We built something for therefore many years and it took gorgeous 30 days for it tumble by over 60%,” he acknowledged, alongside side that the agency had no longer made any decision on exploring the public markets.

Airbnb-backed Oyo had between $780 million to $800 million in its bank, Agarwal acknowledged at a digital conference lately and had pared its “monthly burn” all over all companies to $4 million to $5 million. (The startup had about $1 billion in the bank in December 2020.)

Excellent month — after Agarwal’s remarks on the aforementioned conference — Oyo acknowledged it had raised $660 million in debt. That debt used to be former to pay off the outdated debt, primarily based on an particular particular person acquainted with the matter.

If the deal between the 2 corporations materializes, this might well also be Microsoft’s most up-to-date funding in an Indian startup. The agency has backed a handful of startups in the South Asian market, alongside side news aggregator and quick-video platform DailyHunt, e-commerce giant Flipkart, and logistics SaaS agency FarEye.