Indian budget hotel startup Oyo is off to a good start in UAE, hosts over 100,000 guests in nine months

Indian budget hotel startup Oyo that recently raised $1 billion in its latest funding round led by SoftBank, is off to a good start in United Arab Emirates. The startup that expanded to UAE earlier this year in April claims to have welcomed over 100,000 guests in these nine months. These are pretty decent numbers considering that Airbnb hosts received about 90,000 guests last year.

Founded in 2013 by Ritesh Agarwal who was only 19 at the time, Oyo works as a hotel aggregator that partners with independent and small hotel owners and works with them to standardize rooms and services with basics like clean sheets and WiFi. The startup then sells these Oyo-branded rooms through its online platform. Apart from franchised hotels, Oyo has recently also added homes and living spaces to its platform.

The startup currently manages an inventory of 1300 rooms across 14 properties and 20 homes in Dubai, Sharjah, Ras Al-Khaimah and Fujairah, and is aiming to take this number to 12,000 (rooms) by 2020. Oyo aims to continue adding two, three and four star hotels to its network in UAE.

Interestingly, almost 46% of Oyo’s guests since its launch in UAE have come from within UAE with the rest coming from India, Oman, Saudi Arabia, France, Russia, United States, Australia, Italy, Nigeria, Pakistan, Bangladesh, Mauritius, United Kingdom among several other countries.

The top ten countries in terms of guests received by Oyo’s properties in UAE include UAE, Oman, India, Saudi Arabia, Nigeria, France, Russia, Pakistan, USA and Bangladesh.

Manu Midha, Oyo’s Regional Head for Middle East, in a statement, said, “We are seeing growing interest from the Indian subcontinent and the GCC countries due to their close proximity to the UAE. Footfall from African countries in addition to Europe is also seeing an upswing due to the growing trade between these countries. Another key reason for this growth is the country’s highly active MICE and tourism industries which brings in visitors from all corners of the world.”

Vartika Goel, Oyo’s Country Head for UAE, added, “Dubai Shopping Festival, Christmas, new year and other world class tourism destinations in UAE are set to increase the number of tourists visiting UAE. We are expecting a large number of tourists during this season and our properties are geared to welcome this additional rush of tourists and we expect the next 4-5 months to be a very highly active period for our business.”

Dubai recently had extended its tourism ambitions, announcing that the city aims to host up to 25 million visitors by 2025. For 2017, this number was around 15.8 million.

With this expected growth, Dubai alone offers a great opportunity for Oyo, and for other startups from the region and beyond. The pie is big enough to be shared between giants like, Airbnb, Oyo, and small players who are just starting.

Zubair Naeem Paracha
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