Ritesh Agarwal, founder of OYO Rooms based in Gurgaon. Just over two-and-a-half years after its launch, OYO now has about 5,000 hotels as part of its network in 175 cities across India. Courtesy OYO Rooms
Ritesh Agarwal, founder of OYO Rooms based in Gurgaon. Just over two-and-a-half years after its launch, OYO now has about 5,000 hotels as part of its network in 175 cities across India. Courtesy OYO RShow more

Founder of OYO Rooms in India believes in ideas inspired by personal solutions



At just 22, Ritesh Agarwal is the man behind India’s largest branded network of hotels.

But while he might be one of the country's most successful young entrepreneurs, his mother still regularly tries to persuade the college dropout to consider going back to get a degree.

“I go home once a year and every time at the breakfast table, she says, ‘If you don’t have a degree on your bio-data, would anyone marry you?’”

Returning to higher education is unlikely though, as the chief executive is far too busy with his rapidly expanding budget hotel company, OYO Rooms.

Based in Gurgaon, a satellite city of Delhi, and a bit more than two-and-a-half years after its launch, OYO now has about 5,000 hotels as part of its network in 175 cities across India. In August, it secured an investment of US$100 million from the Japanese telecom and internet giant SoftBank.

The aim now is to expand OYO to include 25,000 to 30,000 hotels in India by the end of this year. With a population of more than 1.2 billion and Indians increasingly travelling within the country amid rising incomes and the rise of budget air travel, there is huge potential.

The company is also looking to go global, with Dubai a top priority. “The question is when, because we have significant ambitions for India that we are working hard towards,” says Mr Agarwal. “Most specifically, the Middle East presents an extremely exciting opportunity because a lot of Indians travel there and reside there.”

Mr Agarwal’s entrepreneurial journey started in 2011 when he founded Oravel Stays, an online platform for listing and booking accommodation. Then in May 2013, he transformed it into a marketplace for standardised budget hotels by launching OYO Rooms, under which existing lodgings have to meet specific brand standards to be part of the chain. The company is tech-driven, with an app available that allows guests to book hotels and order drinks to their room.

“I never thought that this would become something this large, with the ambition of making it larger than we have today,” says Mr Agarwal. Originally from the small town of Bissam Cuttack in the state of Odisha in the east of India, his parents are conservative and did not discover their son had dropped out of college until they came across articles about him in the media.

Mr Agarwal came up with the idea of starting a branded budget hotel chain because of “painful” experiences travelling around India as a child and staying with relatives, and then later in life staying in guesthouses and bed and breakfasts in the country. “I think that was the time when I felt there’s a huge problem of predictability in the accommodation experience in India,” he says.

A big break for the entrepreneur came when he was selected for a Thiel fellowship in 2013, a two-year programme set up by the PayPal founder, Peter Thiel, which included mentorship and a $100,000 grant to launch his business. The fellowship taught him to “think really big” and that “emulating something is not so cool”, he says.

When it comes to expansion to Dubai, OYO has existing connections in the emirate. And, with a team already in place working on understanding the market, Mr Agarwal believes the chain will enter Dubai this year or next. “A lot of our hotel owners in India also have hotels in Dubai, and a lot of other hotel operators who live there have hotels here in India that we operate and partner with,” he says. “There is also a clear similar problem in the sub-$30 or $40 range – there’s no clean, comfortable, affordable, technology-savvy hotel chain out there.”

But would the company really be able to offer such cheap rooms in Dubai?

“Similar questions arose in India when we were starting out,” explains Mr Agarwal, who says one of his biggest challenges was persuading hotel owners to join OYO. “In Gurgaon there was not a single hotel available in the budget segment below $70 to $80, and today we consistently operate at $25 to $30 and a bunch of cities are already profitable for us.

“In Mumbai, you would not get many budget hotels below $100 a night and we sell at $50 a night on average. We understand how to use occupancy and the load rates to become 80 to 90 per cent and very strongly decrease the average prices per night.”

Mr Agarwal attributes his success to being “passionate about the mission of actually solving the problem for myself”, whereas “almost everyone else was doing it as a form of creating a business where they would try to solve it for others”.

However, success is not always a smooth ride – he has received death threats from competitors, something he takes in his stride.

“It’s not that scary,” he says.

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Tu Jhoothi Main Makkaar

Director: Luv Ranjan

Stars: Ranbir Kapoor, Shraddha Kapoor, Anubhav Singh Bassi and Dimple Kapadia

Rating: 3/5

ICC Awards for 2021+

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T20 Cricketer of the Year+– Mohammad Rizwan+(Pakistan)

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Test Cricketer of the Year+– Joe Root+(England)

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Cricketer of the Year+– Smriti Mandhana+(India)

ODI Cricketer of the Year+– Lizelle Lee+(South Africa)

T20 Cricketer of the Year+– Tammy Beaumont+(England)

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Display: 6.8" edge quad-HD+ dynamic Amoled 2X, Infinity-O, 3088 x 1440, 500ppi, HDR10+, 120Hz

Processor: 4nm Qualcomm Snapdragon 8 Gen 2, 64-bit octa-core

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Platform: Android 13

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Battery: 5000mAh, fast wireless charging 2.0, Wireless PowerShare

Connectivity: 5G, Wi-Fi, Bluetooth 5.2, NFC

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Dark Souls: Remastered
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Engine 3.5L V6

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Power 421hp @ 6,000rpm

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Fuel economy, combined 14.1L / 100km

BOSH!'s pantry essentials

Nutritional yeast

This is Firth's pick and an ingredient he says, "gives you an instant cheesy flavour". He advises making your own cream cheese with it or simply using it to whip up a mac and cheese or wholesome lasagne. It's available in organic and specialist grocery stores across the UAE.

Seeds

"We've got a big jar of mixed seeds in our kitchen," Theasby explains. "That's what you use to make a bolognese or pie or salad: just grab a handful of seeds and sprinkle them over the top. It's a really good way to make sure you're getting your omegas."

Umami flavours

"I could say soya sauce, but I'll say all umami-makers and have them in the same batch," says Firth. He suggests having items such as Marmite, balsamic vinegar and other general, dark, umami-tasting products in your cupboard "to make your bolognese a little bit more 'umptious'".

Onions and garlic

"If you've got them, you can cook basically anything from that base," says Theasby. "These ingredients are so prevalent in every world cuisine and if you've got them in your cupboard, then you know you've got the foundation of a really nice meal."

Your grain of choice

Whether rice, quinoa, pasta or buckwheat, Firth advises always having a stock of your favourite grains in the cupboard. "That you, you have an instant meal and all you have to do is just chuck a bit of veg in."

Manikarnika: The Queen of Jhansi

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Name: Abeer Al Bah

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Children: Soud, born 1993, lawyer; Obaid, born 1994, deceased; four other boys and one girl, three months old

Education: BA in Elementary Education, worked for five years in a Dubai school

 

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Name: Kinetic 7
Started: 2018
Founder: Rick Parish
Based: Abu Dhabi, UAE
Industry: Clean cooking
Funding: $10 million
Investors: Self-funded

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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LAST 16

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PLUS

Real Madrid, Tottenham, Atalanta, Atletico Madrid, Napoli, Borussia Dortmund, Lyon, Chelsea

Kill

Director: Nikhil Nagesh Bhat

Starring: Lakshya, Tanya Maniktala, Ashish Vidyarthi, Harsh Chhaya, Raghav Juyal

Rating: 4.5/5

The specs

Engine: Single front-axle electric motor
Power: 218hp
Torque: 330Nm
Transmission: Single-speed automatic
Max touring range: 402km (claimed)
Price: From Dh215,000 (estimate)
On sale: September