In conversation with Social Samosa, Ritesh Agarwal takes us through his journey, from Oravel Stays to OYO Hotels & Homes.
How far can one’s passion & fire to do something can take them can baffle onlookers. It was 2012, an 18-year-old boy set off from Odisha, trying 100+ bread and breakfasts in a bid to find the solution for quality accommodations on a budget. Six years later, the boy owns one of the biggest hotel chains and managed to literally rewrite the hospitality-tech sector.
Ritesh Agarwal, Founder & Group CEO, OYO Hotels & Homes is still the same candid & humble boy from Odisha. In conversation with Social Samosa, Agarwal takes us through his journey, from Oravel Stays to OYO Hotels & Homes. And it’s just the beginning…
Right answers are derived from the right questions, which take you further. One question in your opinion that changed your life completely, carving you into the person you are today?
The big question that led to setting up OYO Hotels & Homes was how I ensure the common man in this country is able to access high-quality living spaces at affordable price points without compromising on location. It was a complex and multi-layered problem.
I started with Oravel Stays in 2012, that made hotel discovery easy but I soon realized that’s not going to be enough. It’s also important to ensure a consistent and controlled experience end-to-end for customers. Since I loved exploring new cities and cultures, I spent most of my ‘me time’ traveling all over the country and during such trips, discovered a disconnect between demand and supply of quality living spaces. More often than not travelers and city-dwellers were forced to compromise on location, quality, and price. I wanted to fix this problem by using technology and talent. That’s how OYO was launched in 2013, with the promise of delivering predictable, affordable, anytime-available stay experiences for travelers – a 100% ‘Made-in-India’ business model and the first-of-its-kind worldwide.
The Indian society is challenged by the shackles of dogmas and stereotypes, many of which you have known to go beyond through perseverance and courage. Which have been the biggest hurdles you had to get through?
What I have learned since I have embarked on my entrepreneurial journey is that just because an idea sounds good, it doesn’t necessarily mean it will work. Studying the market to identify the gaps in demand and supply is an excellent place to begin your search for ideas. Once you spot a need gap, you can focus on offering that ‘simple yet powerful’ solution that has the power to disrupt the space. That’s what worked for me. While I was traveling across India on a shoestring budget and had to lodge in some of the not so great guest houses, I realized that I was looking at the wrong end of the rope. The problem wasn’t the lack of availability of budget hospitality options; it was that the majority of unbranded hotels lacked the minimum baseline standards of quality and service delivery. This meant that the solution wasn’t merely aggregating hotels on a website; it was to consolidate and upgrade the fragmented segment and ensure the delivery of predictable, standardized and affordable stay experiences for travellers across price points.
In the initial days, convincing hotel owners to associate with OYO was a herculean task. Being a completely new, untested business model, hotel owners were skeptical about the value and prospects we offered. I would often see myself making a commitment to bear the losses if any, and share profits.
Soon they started seeing repeat customers and greater revenues. They also noticed how hotel operations, revenue management, and CRM became more efficient and convenient via OYO apps – they were convinced.
Looking back over the last 5+ years, I believe our passion, perseverance, and grit helped us pivot to where we are today. While it is still Day 0 for us, and we do have a large opportunity to tap into, and aim to be the largest hotel chain in the world by 2023.
What are the questions you ask when stuck in a deadlock?
At OYO Hotels, I call myself the Chief Clarity Officer. Which means that my job is to share what to do and advise on what not to do. More important is, what not to do than what to do. So, setting out the principles which enable everybody to decide how they can run their jobs.
I always keep myself in the customer’s shoes and ask if it will add value to their experience.
That makes it very easy for people to focus, and that focus has the means of creating value for customers and asset owners alike. At the core of it, we have to be solving a problem in a sustainable and scalable manner.
Tell us how asking the right questions have made you stronger and helped you get further in life?
One of the things I learned while building OYO is about creating an ecosystem of innovation by empowering people and making them partners in success. Every employee at OYO is called an OYOpreneur and we are ardent believers in empowering people and teams through distributed leadership. Every morning is challenging when I have to be amidst the stalwarts of the respective fields when there are questions and tasks to be resolved. I need to be on top of my game and stay abreast of the industry scenario, and the business to be able to respond and counsel sensibly with all my stakeholders.
For me, the drive and conviction to make things happen are important while working in an environment that’s as dynamic and challenging as ours.
What would be the three daily habits that you helped you further your growth into becoming what you are today? How did you inculcate them in the first place?
Enhancing the knowledge base, connecting with industry experts, being open to constructive criticism has played a vital role in shaping my entrepreneurial journey. For one to excel in their respective field, investing in staying ahead of the curve is crucial, and to achieve the overall mission of the organisation, collaboration is the key.
Who is the one person you look forward to and who has inspired you to shatter the glass ceiling?
Being selected for the Thiel Fellowship
is one of the most memorable experiences for me. Peter Thiel has been one of my
biggest role models. Getting mentored by him really changed my worldview and
gave me a new perspective on the way I was looking at entrepreneurship. His
book Zero to One was really inspiring as well.
Only when I went for the Peter Thiel fellowship did I learn to think big, to think in terms of creating an enduring, growing, lasting business idea. You should never compromise on culture even if your company becomes huge. Hire extremely smart people.
My experience as a Thiel Fellow has also been pivotal to imparting the understanding of the start-up ecosystem under the guidance of the Foundation’s network of tech entrepreneurs and investors. I learned to trust the power of a unique idea, rather than trying to build an Indian version of a US or Chinese company.
Albert Einstein once said, “A person who never made a mistake, never tried anything new.” Which is the one mistake in your career or life that eventually helped you become a better person and professional and grow in life? If you had the opportunity, would you do it differently?
While you are in the process of coming up with a truly innovative solution, it is essential to keep an open mind. One should accept failure, and be willing to learn, unlearn and relearn again. I have always believed that an overnight success story is backed by at least five years of dedicated hard work and perseverance.
Often, it is not the most complex solution, but the most creative one that can help solve a problem.
The importance of innovation cannot be overstated.
Looking back, which is the one moment that made it all worthwhile?
There is not one but many moments. Every time I see an OYO logo, we call it “golu” the supergraphic on the walls of OYO buildings, I feel we have given so many customers one more accommodation option that is good quality yet affordable and that we have given so many asset owners operating small and independent hotels the ability to compete with the big chains.
OYO Hotels & Homes has now emerged
as South Asia’s largest, China’s second largest, world’s sixth largest and
fastest-growing hotel chain globally. OYO today host guests from around the
world in over 20,000 franchised and leased hotels and over 700,000 rooms, and
more than 45,000-holiday homes, adding over 64,000 rooms every month, globally.
Every night almost 450,000 heads rest on a pillow in an OYO, a testament to the
impact we are creating globally.
We see a huge opportunity in front of us of building a global brand that is truly from the heart of India. We often find global brands thriving across the nook and corner of India but with OYO Hotels we are working towards being a truly global brand out of India that can be spotted in the bylanes of Middle East, Southeast Asia, and Europe. This is an important milestone for us but I still feel it is day zero for us. We are still a young company that has a lot to achieve in the years to come.
Which was the one advice/tip that helped you conquer all your fears?
During the past five years, I’ve also learned innumerable lessons that have helped me in shaping OYO’s growth trajectory for the future, along with my leadership team. During the initial days, I was advised by one of my investors about the importance of building a strong team, and until today, it’s one of the most invaluable lessons I’ve learned. After starting up, I was joined by some of the brightest minds in the industry who continue to fuel OYO’s mission of creating beautiful living spaces. We are proud to state that our leadership team has not only continued to stand by OYO through the years but grown as well, in step with the pace of our global aspirations. People and their passion for creating something truly magical is what I count as a crucial factor behind our growth.
Well begun is half done! Please share a few tips for those who are pursuing their dreams and need that inspiration to take the first step.
What one needs to succeed is focus, self-belief, and tenacity. I strongly believe there will never be a substitute for hard work.
The young generation of millenials that aims at solving a problem should also be prepared for it to be a tough journey without forgetting that it will be the best ride they will steer.
I am sure there will still be many more stories, lesser known, often unheard but rewarding nevertheless. Young people all over the world hold a lot of promise and the opportunity to create something, solve a problem, and undertake an entrepreneurial journey has never before been this exciting!