SoftBank-backed Indian hospitality company OYO Hotels & Homes (Oyo) has denied Chinese media reports of firing over 1,000 people in the country claiming the numbers to be incorrect.
The company said it has in fact made fresh hirings in China in the past few months as the country continues to be one of its key global markets.
Chinese tech blog Jiemian on Monday reported that Oyo has largely sacked people from its Chinese development team, plus a few from the operations team. The unicorn startup has an employee base of about 2,000-3,000 people in China.
The report said that the order for layoffs came directly from Anuj Tejpal, chief business development officer at Oyo.
“This is absolutely incorrect, facts are being twisted and misrepresented. In the last few months, we have hired over 1,500 people and will have over 10,000 full-time employees on the role. The presumption of any letting go is wrong, where regular monthly performance reviews are being twisted and reported out of context. We have also created jobs for over 200,000 people in China and will continue to be a leading job creator in China for years to come,” OYO spokesperson told DEALSTREETASIA.
“OYO on a regular basis conduct performance evaluations, to identify and reward good performers, aligned with the company’s larger mission. Like any large company with a significant sales force, for such functions, we make the performance decisions for specific cohorts that impact a small number in the organization, with alignment with the broader teams. Incorrectly positioning such business as usual decisions as ‘a large scale lay off’ is absolutely incorrect, baseless, and misleading,” the company said.
A day ago, Oyo had announced that it will invest $100 million in China towards quality and system improvements and hiring. The allocation is a part of the $600 million OYO had committed last year to its China business.
Oyo entered China in November 2017 and currently boasts of presence in over 337 cities with 500,000 rooms. It has also been reported that Oyo is spending around $22 million per month on its China operations, mostly on personnel.
In a statement in May, Oyo had claimed that it has now become the second-largest hotel group in China. It is also exploring ways to collaborate with online travel agents (OTAs) such as Fliggy, Ctrip and others, along with other consumer traffic-building platforms, the company said. As of now, OYO gets 25 per cent of bookings from OTAs in China.
Globally, OYO has a footprint in more than 800 cities across 24 countries, including Malaysia, Nepal, the UK, UAE, Indonesia, Saudi Arabia, the Philippines and more recently, Japan. It counts India and China as two of its biggest markets.
The hospitality company, which commanded a valuation of $5 billion in its Series-E funding round, is reportedly looking to raise $1 billion in fresh capital from new and existing investors, which would spike its valuation to over $10 billion.
In April, it raised about $75 million in a Series E funding round from San Francisco-headquartered home renting firm Airbnb. While it is still unclear if the Series E funding round is now closed, Gurugram-based OYO has reportedly mopped up nearly $1.2 billion in Series E round, which began in September last year.
According to Crunchbase, OYO has already raised about $1.7 billion in funding till date.
Aside from SoftBank Vision Fund, other investors in OYO include Sequoia Capital, Lightspeed Ventures, Hero Enterprise, and China Lodging Group.