Indian hotel chain Oyo plans to invest $300m as part of a strategy to expand its operations in the US, where the chain is opening an average of one hotel a day.
The hotel start-up, which is backed by Softbank’s Vision Fund, was valued at $5bn in its last funding round in September.
Oyo, which was launched in 2013, has grown through a hybrid online travel agency-come-hotel franchise model and claims to be the world’s sixth-largest hotel chain.
Currently, the company has over 50 hotels in 35 US cities, including Atlanta, Dallas and Houston.
According to Oyo founder Ritesh Agarwal, the company intends to use the funding to continue to grow with expansion into bigger cities, such as New York, Los Angeles and San Francisco.
Agarwal said that the company intends to reach an opening rate of five hotels a day in the US.
The Indian hotel chain is also backed by Airbnb, which acquired a stake worth more than $100m in the company in April. The Indian firm has also secured funding from private equity groups Greenoak Capital, Sequoia Capital and Hero Enterprise.
Similar to Airbnb, which is investing in the hotel industry through its stake in Oyo and acquisition of booking site HotelTonight, the Indian company has established Oyo Home, an online platform for short home rentals, in 2017 in a bid to expand beyond hotels.
In May this year, the company also acquired European short-term property rental company @Leisure for €369.5m.
The company offers independent operators a franchise model, which the company claims will increase their revenues by 100% in six months.
Agarwal said: “Unlike other hotel chains, we send in a civil engineer expert to update the hotel’s design and a general manager to focus on service.”
The Oyo founder cited a hotel in South Dallas that increased its occupancy rates from 18% to over 80% following conversion to the Oyo brand.