While stores, factories and hotels shutter in China amid a coronavirus outbreak, Indian hospitality start-up Oyo is fighting to keep hotels open.
“We’re trying to keep as many of our hotels open as possible, including in Wuhan and in Hubei,” Oyo CEO and founder Ritesh Agarwal told CNBC’s “Squawk Alley” Tuesday.
Oyo operates a chain of leased and franchised hotels and offers vacation homes and living spaces using a model similar to U.S.-based Airbnb. It works with 9,000 hotels in China, making the country Oyo’s second-biggest market.
The hospitality chain is keeping locations open at reduced prices in the provinces most affected by the virus to support visiting doctors and people who’ve been stranded by travel restrictions, Agarwal said.
There are even available Oyo stays around the Wuhan hospital that recently made headlines after it was built in less than two weeks.
Agarwal said it was too early to tell how the virus would impact business for Oyo. The company recently announced restructuring efforts that included layoffs in China, India and the U.S.
“They are to make sure that we focus on locations and cities that are more profitable,” Agarwal said of the restructuring measures.
Founded in 2013 by Agarwal when he was 19, Oyo has since become the fastest-growing and second-largest hotel chain in the world. It operates over 23,000 hotels in more than 800 cities in 60 countries. However, the company recently reported that its annual losses have widened to $335 million. Oyo has also faced allegations that it inflates occupancy levels and does not pay some of the hotels it works with.
Oyo is backed by SoftBank’s Vision Fund, the $100 billion dollar megafund that has also invested in Uber, SoFi and WeWork-parent The We Company.