WORK­ING THE ROOM

A col­lege dropout at 17 and a start-up mil­lion­aire at 23… Meet Ritesh Agar­wal, who has built In­dia’s largest branded net­work of ho­tels, OYO, which to­day has a pres­ence in 200 cities across the coun­try and over 70,000 rooms on of­fer to guests.

Marwar - - Contents - Text Sneha Ma­hale

A col­lege dropout at 17 and a start-up mil­lion­aire at 23… Meet Ritesh Agar­wal, who has built In­dia’s largest branded net­work of ho­tels, OYO, which to­day has a pres­ence in 200 cities across the coun­try and over 70,000 rooms on of­fer to guests.

WHEN IT COMES TO SUC­CESS, AGE IS RE­ALLY JUST A NUM­BER. Ritesh Agar­wal started sell­ing SIM cards at the age of 13. By 17, he had dropped out of col­lege since he felt there was more to achieve by chas­ing his en­tre­pre­neur­ial dream. To­day, at the age of 23, he’s a mil­lion­aire and the founder of In­dia’s largest branded net­work of ho­tels, OYO, a start-up which has a pres­ence in over 200 cities across the coun­try.

Talk­ing about his jour­ney so far, he says, “I dropped out of col­lege since I felt that con­tin­u­ing with stud­ies meant I would lose out on time that could oth­er­wise be utilised in build­ing a busi­ness. I have also been for­tu­nate to get op­por­tu­ni­ties such as the Thiel Fel­low­ship, through which I re­ceived the men­tor­ship and the guid­ance of a vi­sion­ary like Peter Thiel, the co-founder of PayPal. It has been among the most trans­for­ma­tional ex­pe­ri­ences of my jour­ney. I be­lieve dif­fer­ent things work for dif­fer­ent peo­ple, and as long as you are sure about what you want to do, you should fol­low your con­vic­tions.”

At the start

Agar­wal was born in Bis­sam Cut­tack in Odisha and grew up in a small town called Raya­gada. He be­longs to a mid­dle-class fam­ily and is the youngest of four siblings. He en­vi­sioned start­ing his own busi­ness since his school days. But growing up in a small town meant he had lim­ited ex­po­sure to big busi­nesses. Yet, his dogged de­ter­mi­na­tion saw him try­ing his hand at var­i­ous things even as a kid, from sell­ing SIM cards to fast-mov­ing con­sumer goods.

He was also good in stud­ies and si­mul­ta­ne­ously at­tended con­vent schools in town. Even­tu­ally, he moved to Kota in Ra­jasthan to pre­pare for his en­gi­neer­ing en­trance ex­ams. That’s when he started trav­el­ling to Delhi to at­tend startup meets and mix­ers and un­der­stand the space. He ended up drop­ping out of col­lege even­tu­ally, de­cid­ing to fo­cus in­stead on start­ing some­thing in the travel sec­tor.

The spin-off

In 2012, Agar­wal launched Oravel Stays to list bud­get ho­tels on­line. To add more ho­tels on this plat­form, he trav­elled for about three months across the coun­try, stay­ing in over 100 dif­fer­ent ho­tels, inns and bed and break­fasts. “A ma­jor­ity of my ex­pe­ri­ences were less than sat­is­fac­tory. I un­der­stood that the is­sue with bud­get ho­tels was not dis­cov­er­abil­ity but lack of a pre­dictable and stan­dard­ised ex­pe­ri­ence,” he says.

In 2013, Oravel piv­oted to OYO with the prom­ise of de­liv­er­ing pre­dictable, af­ford­able and ‘any­time-avail­able’ stay ex­pe­ri­ences to cus­tomers. The team worked with many small ho­tels on their in­ven­tory, af­ter au­dit­ing and trans­form­ing their rooms to a set stan­dard. Of­ten this meant phys­i­cal re­pair, con­struc­tion, and in­stal­la­tion of fix­tures and ameni­ties. Part­ners would see a jump in rev­enues and oc­cu­pancy rates within six months of sign­ing up. In just three years, OYO be­came the largest ho­tel net­work in In­dia with 7,000 ho­tels across the coun­try.

A unique mix

What prob­a­bly works for OYO is its unique model. It uses a mix of technology and op­er­a­tional acu­men to trans­form and stan­dard­ise ho­tel rooms, and makes them avail­able for book­ing via an app, the web, a call cen­tre and chan­nel part­ners. It also pro­vides tech so­lu­tions to ho­tel part­ners to en­able bet­ter rev­enues and profits; and most im­por­tantly, uses cus­tomer feed­back to en­sure de­light­ful ser­vice and ex­pe­ri­ence. Elu­ci­dat­ing on the unique name of his startup, Agar­wal says, “OYO is a quirky and mem­o­rable name

that res­onates with young, tech-savvy cus­tomers. We did not nec­es­sar­ily in­tend it to mean any­thing. But to­day, along with the red logo, it has caught on and en­joys a high brand re­call.” Start­ing with a sin­gle ho­tel in Gur­gaon, OYO is to­day present in 200 cities, of­fer­ing over 70,000 rooms. It has led to over 40 lakh check-ins to date. Agar­wal says, “We take pride in our net­work’s strength be­cause our in­tent is to pro­vide cus­tomers a reli­able op­tion wher­ever their trav­els take them.”

Chang­ing mind­sets

A lot has changed since OYO’s in­cep­tion in 2013. Dur­ing the ini­tial days, the ob­sta­cles were con­vinc­ing in­vestors, se­cur­ing fund­ing, be­ing able to de­velop a strong part­ner ecosys­tem and at­tract­ing prospec­tive em­ploy­ees. The big­gest chal­lenge was to con­vince peo­ple about a new con­cept. To­day, the test is to con­tinue to bet­ter the ex­pe­ri­ence and ser­vice stan­dards, be able to man­age the huge net­work and con­tinue to cre­ate value for the fu­ture.

And it is do­ing so. Last year, OYO started of­fer­ing sun­rise check-ins from 6 am at some of their prop­er­ties. Now, the com­pany also has op­er­a­tions in Malaysia, and there are plans to of­fer ser­vice apart­ments and home­s­tays by the end of 2017. Agar­wal says, “I am grate­ful and proud of what I have achieved, but there is so much more to do. I never feel stressed with work; there is a sense of ad­ven­ture and a strong pur­pose in it. My work is my pas­sion.”

Trou­ble on the way

There were a cou­ple of bumps along the way though. In 2016, re­ports emerged that Oravel Stays, which runs OYO, was clock­ing losses of ` 46.9 crore per month. Ex­perts also stated that the kind of growth that OYO had seen over the years was un­sus­tain­able. They gave ex­am­ples of ven­tures such as Stayzilla and Room­sTonite that shut shop be­cause of trou­ble with cash flow.

Agar­wal, how­ever, is un­per­turbed. He says, “In In­dia, where there are over 20 lakh un­branded ho­tel rooms in com­par­i­son to 1 lakh branded rooms, there is high de­mand and plenty of room to grow. On­line travel agen­cies bring dis­tri­bu­tion strength. But sup­plier re­pair and qual­ity con­trol by hos­pi­tal­ity ex­perts such as OYO is es­sen­tial for the growth of the In­dian travel mar­ket, es­pe­cially in the bud­get seg­ment. We are con­fi­dent of driv­ing long-term fu­ture growth in this busi­ness.” He also dif­fer­en­ti­ates OYO from im­me­di­ate com­pe­ti­tion. “In­no­va­tion and dis­rup­tion is in our DNA. Our teams are ag­ile, data-ori­ented and cus­tomer-fo­cused. All these values con­trib­ute to our mo­men­tum,” he adds.

Trend­ing now

Over the past few years, there has been a marked change in the way In­di­ans travel. From spo­radic hol­i­days once or twice a year, In­di­ans now travel more fre­quently and of­ten in­dulge in short-no­tice or im­pulse travel. In fact, the team at OYO found that 61 per cent of their ho­tel book­ings in 2016 came from im­pulse trav­ellers, i.e., peo­ple who booked a room less than a day be­fore check-in!

The in­ter­est­ing thing is, de­spite this trend of un­planned travel, cus­tomers ex­pect a pre­dictable stay ex­pe­ri­ence. Among guests, Wi-Fi, com­pli­men­tary break­fast and hy­gienic rooms come up as their three big­gest pri­or­i­ties. And in the years to come, this be­hav­iour is ex­pected to man­i­fest it­self fur­ther.

Agar­wal is up for the chal­lenge. He says, “One of the things that I learned while build­ing OYO is to cre­ate an ecosys­tem of in­no­va­tion by em­pow­er­ing peo­ple and mak­ing them part­ners in suc­cess. I am very lucky to have a great set of col­leagues at OYO.”

Mov­ing on

In his free time, Agar­wal likes to cy­cle and prac­tise yoga for re­lax­ation. Catch­ing a late-night movie with friends (mostly col­leagues) is also a de-stresser. As a Mar­wari, he be­lieves the com­mu­nity ex­em­pli­fies keen busi­ness acu­men, hard work and risk ap­petite. These are re­ally im­por­tant qual­i­ties that help in build­ing strong busi­nesses. He says, “I think ex­po­sure to ex­am­ples from the com­mu­nity, con­ver­sa­tions and an un­der­ly­ing fo­cus on build­ing value have helped me shape my own busi­ness out­look.”

Lastly, Agar­wal says he wants to es­tab­lish OYO as one of In­dia’s top con­sumer busi­nesses. He says, “Our aim is to cre­ate a per­fect equi­lib­rium be­tween lo­ca­tion, com­fort and pric­ing by us­ing technology and a skilled tal­ent pool to de­liver pre­dictable, af­ford­able and ‘al­ways-avail­able’ ho­tel ac­com­mo­da­tion to trav­ellers.”

From top: An OYO ho­tel; The OYO Town­house is based on the needs of the mil­len­nial trav­eller

From top: Ritesh Agar­wal be­ing fe­lic­i­tated with the New-age En­tre­pre­neur Award by the Asian Cen­tre For Cor­po­rate Gov­er­nance & Sus­tain­abil­ity in 2016; with his col­leagues at OYO

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.