A 24-Year-Old Built a $5B Hotel Startup in Five Years

As a customer, I find OYO hotels to be very bad. There are hotels that I otherwise would not even have gone to (since low end hotels in India are appallingly filthy), but the OYO label lends them greater credibility.<p>I avoid OYO when I can.<p>A general thumb rule I follow for booking hotels in India is : if you are staying with family, go for hotels priced around or more than 40-50% of the price of the top end chain hotels in that city. For example, in Delhi, try not to book any hotel priced below Rs. 3500 per night. Chances are high that it may be cockroach-infested and grimy. Many of these now have the dreaded OYO label attached to them.

It&#x27;s a franchise system.<p>Franchises are wonderful when you are in <i>expansion</i> phase--especially if you have a nicely banked war chest (which this company does because of the VC backing).<p>The test of a franchise is when it is in stable or contraction phase.<p>That&#x27;s when you find out if it&#x27;s a business or a pyramid scheme.

As an anecdote, this happened at an Oyo hotel: <a href="https:&#x2F;&#x2F;www.youtube.com&#x2F;watch?v=myhubCtp-DI" rel="nofollow">https:&#x2F;&#x2F;www.youtube.com&#x2F;watch?v=myhubCtp-DI</a><p>TL;DW: Western woman was trapped in the room by hotel employees threatening sexual assault.

I first heard about OYO through a friend who shared this livemint article:<p><a href="https:&#x2F;&#x2F;www.livemint.com&#x2F;Companies&#x2F;7CN7u5d4i3bfYgBAZLdLpM&#x2F;Will-the-real-Ritesh-Agarwal-please-stand-up.html" rel="nofollow">https:&#x2F;&#x2F;www.livemint.com&#x2F;Companies&#x2F;7CN7u5d4i3bfYgBAZLdLpM&#x2F;Wi...</a><p>The article paints a terrible picture of a guy who has embraced the - fake it, till you make it mantra. Lied about Thiel scholarship, best selling books and even screwing his partners.

OYO has made convenient finding hotels and making confirmed reservations in hotels in small town india. Also since all payments are billed by OYO and not the hotel, the hotel cannot fleece you like charging more for a foreign national. They also have a convenient functional app.

And his surname is not Patels. :-) The Patel clan own a lot of the Mom and Pop hotels in the US.

I&#x27;m so tired of seeing articles like this. WHO CARES? Nothing about this story is repeatable. It deludes the masses in terms of real prospects of starting a business. The headline alone is just clickbait. It&#x27;s completely unfair, as it robs desperate people of a reality check. I wish I could downvote this.

Another story glorifying a sociopath!<p>Article on Oyo founder (Ritesh) from 2015 - <a href="https:&#x2F;&#x2F;www.livemint.com&#x2F;Companies&#x2F;7CN7u5d4i3bfYgBAZLdLpM&#x2F;Will-the-real-Ritesh-Agarwal-please-stand-up.html" rel="nofollow">https:&#x2F;&#x2F;www.livemint.com&#x2F;Companies&#x2F;7CN7u5d4i3bfYgBAZLdLpM&#x2F;Wi...</a>

Imagine if we lived in a society where these stories were about <i>housing</i> startups, not hotel startups. Food production startups instead of food packaging startups. Public infrastructure projects instead of scooter renting apps. Actual creation of wealth and value added to the economy instead of endless insipid rent-seeking, shuffling value around from middleman to middleman until one of them figures out a more efficient way to extract.