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Ritesh Agarwal : A 23-years Millionaire Who Founded Oyo Rooms

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Ritesh Agarwal, founder and CEO of OYO Rooms, has become a significant figure in the entrepreneurial world, after his gargantuan success. It is quite commendable for an eighteen-year-old to start a business oh his own, and make it worth millions over a span of six years.

Early life and career

Born into a small town, called Bissamcuttack of southern Odisha, Agarwal belonged to a middle-class Marwari family. He was born on 16th December 1993 and resided with his parents, until he decided to establish a business of his own. Unlike the typical Marwari families, Ritesh’s family wasn’t financially predominant, but they always supported his dreams and trusted him. From a very tender age, Agarwal had a keen interest in software and coding. He started learning beyond the limited syllabus of school and delved deeper into computer languages. At an early age of eight, he started learning to code, and by the time he was in his tenth grade, became quite a good programmer. He loved programming and wanted to make his career in it.

Ritesh Agarwal Oyo Rooms
Image Source: telegraphindia.com

Agarwal did his schooling from Odisha. Later, he moved to Kota to prepare for his IIT entrance exams. So, he was just a common head among the mass, who wanted to pursue engineering. But that never happened. He took admission in the University of London’s India campus. But after just a few days, he went on leave and never came back. He wanted a different life for himself, and the outdated studies at the college could not give him that. As they say, some feathers are too bright to be caged.

He launched a website Oravel Stays, his first start-up at the age of eighteen after he dropped out of college. The website was designed to enable customers to look for budget-friendly accommodations in various places. This was when he realized that there is a great scope of improvement in the hospitality sector and started back-packing across the country to learn and explore more and get accustomed to the realistic scenario. He also sold sim cards during the journey of his immense struggle to meet the financial needs.

After his venture of three months, he stayed in more than a hundred hotels, bed and breakfast homes, and guesthouses. He, finally, whirled from Oravel Stays to OYO Rooms in 2013. Since, he stepped into the real world from the very beginning to gain genuine understandings of how the business on his interested field works and what it lacked, the success of OYO Rooms escalated even more rapidly than Oravel Stays. He was also the first Indian to be chosen for Thiel Fellowship and was granted $100,000, as he was under twenty and a college dropout. Agarwal, in one of his interviews in 2015, said that OYO is the abbreviated form for ‘On Your Own’.

The success story of Ritesh Agarwal and OYO Rooms

OYO Rooms was founded in 2013 and turned out to be the country’s largest hospitality company. The company has its headquarters in Gurgaon, Haryana. Soon after the establishment of the company, the business expanded exponentially not only among various cities of India but also across Asia and Europe. OYO has also grown firm roots in China, Malaysia, Nepal, Japan, Indonesia, the United Arab Emirates, the Philippines, Saudi Arabia and the United Kingdom.

In May 2014, the company raised $650,000, followed by raising $24 million in an investment round led by Greenoaks Capital in March 2015. Companies like Lightspeed Venture Partner, Sequoia Capital and DSG Consumer partners also participated in the round. In 2015, another round of $100 million was raised by the company from Softbank Group.

In August 2016, the company raised $90 million from Softbank Group, Innoven Capital and other investors. This gives a clear picture of the growth trajectory of the company since it was formed.

In September 2017, OYO closed a $250 million round of funding, which was led by a new investor Hero Enterprise along with Softbank. By this time, the value of the company had reached around $850 million-$900 million, changing the face value of this Indian company across the globe. In the same year, OYO launched OYO Home to manage short-term rentals in more than 10-holiday destinations of India, and in the very next year, it launched its first international OYO Home in Dubai.

In September 2018, the company raised $1 billion, where most of the funding was led by the already existing investor Softbank Group’s Softbank Vision Fund, where participation of Lightspeed Venture Partner, Sequoia Capital and Greenoaks Capital was witnessed. The company also received a funding of $200 million from an investor the company denied to reveal the name. After this deal, the company’s value was $5 billion giving it an unexpected leap.

In May 2019, OYO announced that it would acquire a rental business (Leisure Group) based at Amsterdam.

Currently, OYO has a network of 2,200 hotels in more than 154 of India. The current CEO of OYO is Aditya Ghosh, and there the company has around 1500 employees working in various sectors to spread across the entire world to provide the best shelters to the travellers even at offbeat destinations.

From spending nights on the stairs of Masjid to CEO of $60 million company

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Success does not always need to get along with grey hair; some people change the stereotypes. Among few such people, Ritesh Agarwal possesses a remarkable position. No doubt he has shown wonders in the world of entrepreneurship and made all the competitors to gape their mouth wide open. As it is said that everyone sees dreams but only few can turn them into reality; Ritesh Agarwal’s dedication and immense talent made his dream come true. The path chosen by him was not better than a jigsaw but his incessant efforts made it possible to overcome all odds and build a successful empire.

Imprints of talent right from childhood

Agarwal was drawn towards coding and computers since he was 8 years old. Pursuing his desire to become a self-made man, he undertook a project at the age of 13, when kids hardly are aware about career and jobs. The project gave him a life time experience and set a milestone in his career. During the project he traveled a lot and analyzed how the hotel system works. You can that see his relation with hotels had been established at that age only.

However, his love for computers enchanted him towards technical line and at the age of 16, he was selected in the Asian Science Camp at Tata Institute of Fundamental Research in Mumbai. His resolution to follow science led him to Kota for the preparation of one of the most reputed technical entrances in India. Meanwhile at Kota he authored the book ‘The Encyclopaedia of Indian Engineering Colleges’. But he could not locate his real aim there as well. Exploring the motive of his life he moved to Delhi in 2011 where sprouted his first business idea.

Image Credit- oyorooms.com

A journey full of risks and struggle

Passion to start off something on his own had always been there in him. Ritesh’s decision to drop out his formal education and step into the business world proved to be a life changing one. At the age of 17 he laid the foundation of a company named Worth Growth Partners and became India’s youngest CEO. However, the company couldn’t take him to a higher ladder of success and the very year he was hard struck by financial crisis. He had no money to pay the rent and henceforth spent several nights on the stairs of Masjid in Delhi.

But all these hurdles could not budge Ritesh from his aim and the next year he founded another company, Oravel. This business could be called as an Indian version of the site Airbnb, dealing with bed and breakfast hotels. The idea grew fast within a short span and he received a funding of Rs.30 Lakhs from VentureNursery. The efficiency of his efforts and skills made him the only Indian to get the Thiel Fellowship where he was granted an amount of $100,000.  Ritesh had a thing for learning from always and this led him to acquire more knowledge about the entrepreneurial world from all the possible sources.

Renaming the company to OYO

Ritesh’s itch of seeking better responses from a larger section of society took him to the idea of OYO stays. He could see that Oravel targeted limited number of customers who could spare a large amount from their pickets. Therefore, he himself visited and stayed at several budget hotels to have a closer understanding of the needs of customers. After this he used most of the grant from Thiel to build the OYO chain to provide the best stay in the branded budget hotels.

The journey wasn’t a smooth one there as well as he started the journey with a single hotel in Gurgaon where he handled the duties of CEO, housekeeping and sales single-handedly. However the company soon geared up and received a funding of  $650,000 from Lightspeed Venture Partners and DSG consumer Partners. OYO rooms and Ritesh Agarwal didn’t turn back then and progressed with more investors getting along with them. In just 10 months it received $6 million from Sequoia Capital and LSVP at a pre-money valuation of $60 million.

When Controversies surrounded Ritesh Agarwal

The success story of Ritesh attracted a number of haters and criticizers who could not swallow the fact that a man as young as 22 could build such a huge business. People questioned his skills of coding and called him a liar and fake. He was also accused of blurring the funding records of company. His former relations with NCrypted Technologies also came in the limelight when the latter accused Ritesh of stealing their idea. However there were no real evidences found against Ritesh.

People are always ready to grab the opportunity to pull you back but the story of Ritesh Agarwal, who fought against all odds and established himself as a successful person will always inspire youngsters.