Son said that OYO is one of the largest hotel networks in India and has become the second biggest hotel network in China in just one year Peerzada A
Son said that OYO is one of the largest hotel networks in India and has become the second biggest hotel network in China in just one year
Peerzada Abrar | Bengaluru
Last Updated at June 20, 2019 07:10 IST
SoftBank Group Corp. founder Masayoshi Son is expecting Indian startup OYO to become the largest hotel network in the world. At a general shareholders’ meeting in Tokyo on Wednesday, Son said that OYO is one of the largest hotel networks in India and has become the second biggest hotel network in China in just one year. The company is growing its market worldwide in regions such as the US, UK and Southeast Asia. “They (OYO) would be becoming the largest hotel network in the world,” said Son.
In May this year, SoftBank, which is one of the biggest start-up investors in the country, observed its operating profit for the year ended March raised by valuation gains from its investments in companies such as OYO and ride-hailing giant Uber.
Masayoshi Son-led SoftBank’s Vision Fund has over $100 billion in committed capital for tech investments. SoftBank had said the value of Vision Fund’s investments in 69 firms had increased to $72.3 billion by end-March, from their $60.1 billion acquisition cost, driven by gains at companies like OYO and Uber. For instance, SoftBank had recorded a 154.2-billion yen valuation gain in OYO. Last year in September, SoftBank led a $1-billion fund infusion into OYO. The firm was founded in 2013 by Ritesh Agarwal, who was then aged 19.
Besides OYO, SoftBank’s Vision Fund has backed many companies in India, including Paytm, Policybazaar, Delhivery and Grofers. “Paytm is like Alipay in China. They are the leaders in payments in India and they (have) changed the payment process and lifestyle,” said Son.
SoftBank said it had successfully monetized its investments in e-commerce company Flipkart and graphics chips company Nvidia in FY 2018, the only two exits since the launch of the fund. A 146.7 billion yen investment gain was recorded through the sale of Flipkart shares.
Flipkart was acquired by US-based retail giant Walmart for $16 billion last year. Interestingly, during the shareholders’ meeting, Son revealed that Walmart and its rival Amazon were two potential buyers for Flipkart and were in the process of negotiation. “We decided to sell it to Walmart. The employees and management team were willing to work in collaboration with Walmart,” said Son.
SoftBank Vision Fund aims to accelerate the ‘information revolution’ by continuously making large-scale and long terms investments in companies aiming to realise next-gen innovations and platform business. Here artificial intelligence is going to play a key role as it is revolutionizing all the industries and it is being led by the entrepreneurs. “AI, I think is the biggest revolution in human history,” said Son. But he said that SoftBank’s role is not to develop AI technologies such as autonomous driving but he wants his portfolio companies like ride-sharing firm Uber, DiDi, Grab and Ola to develop them. The intention is to create a world without car accidents through autonomous driving.
“I want to be the conductor of the AI revolution. The conductor doesn’t play any instrument, however, he (orchestrates) everything,” said Son.
The firm is also planning to set up SoftBank Vision Fund-II as the present fund is expected to be over soon. Rajeev Misra, the CEO of the SoftBank Vision Fund said that the company has invested 75-80 unicorn companies across the world including India, Japan, China, Europe and the U.S. He said the firm is expecting to nurture 150 technology companies in a year or two, and some of them would be of $100 billion in value like Uber, DiDi and ByteDance.
“We are only two years old… The Vision Fund is not a fund, it is a holding company. It is an umbrella of the most successful technology companies,” said Misra.
First Published: Thu, June 20 2019. 07:10 IST