What SoftBank's US$700M valuation cut means for OYO, its investors, employees – The Ken

You’re signing up for an account which gives you access to a weekly free story and our archive of free stories. You will also receive a daily newsletter in your inbox. You can unsubscribe by clicking the link in the footer of all our emails.
“Surprise is the greatest gift which life can grant us.”
Boris Pasternak

We allow only two simultaneous login sessions per subscriber. If you continue, we will log you out from the above devices
Account successfully created

Account details updated
Email Sent to:

Check your inbox for instructions to reset your password.
Slice and Dice
On 19 September, IPO-bound hospitality chain OYO filed an update to its draft red herring prospectus (DRHP) claiming to be Ebitda-positive as of the quarter ended June 2022
Unfortunately for OYO, this was followed by a cut in its valuation by its largest investor SoftBank to US$2.7 billion, a far cry from the US$9.6 billion that OYO commanded in 2021
While the company disputes the write-down, a closer look at its recovery from the pandemic versus listed peers and its stated business metrics highlight the rationale behind Softbank’s decision
But, even as the company moves to be a leaner and more prudent business, it faces the challenge of balancing profitability and growth to win back investors’ trust and justifying its expectations for the IPO
Want to read our free stories and try our newsletters?
On 19 September, when OYO Hotels disclosed its

results results SEBI Oravel Stays Limited – Addendum to the DRHP Read more  for the quarter ended June 2022, it was supposed to be a celebratory affair. The Indian hospitality startup had just turned

Ebitda Ebitda Earnings before interest, taxes, depreciation, and amortization (EBITDA) is a widely used measure of core corporate profitability. -positive, signalling its readiness for its listing,

expected expected Bloomberg SoftBank-Backed Oyo Seeks to Resurrect IPO as Growth Resumes Read more  to be in January 2023.
Instead, things got gloomy within days, thanks to its largest investor, SoftBank Group Corp. The Japanese venture-capital giant

reportedly reportedly The Mint Softbank cuts valuation of IPO-bound OYO to $2.7 billion Read more  marked down the value of OYO—in which it holds 47%—to US$2.7 billion in the quarter ended June. This was 20% less than SoftBank’s earlier estimate and over 70% below the valuation at which OYO last raised funds a year ago.
The hotel-booking platform was valued at US$9.6 billion after an investment by tech giant Microsoft in September 2021, when it filed for its US$1.1-billion initial public offering (IPO). But, with a bearish sentiment gripping the stock market, there was speculation about its IPO being

slashed slashed The Economic Times OYO may reduce IPO size, valuation may be readjusted too Read more  by half or delayed further. 
With the latest filings, the company seems to have reiterated its commitment to going public. However, the SoftBank write-down muddies the narrative OYO is trying to present before the share sale. In an update to its IPO filing earlier this month, the startup claimed to have become Ebitda-positive as per its

Non-GAAP Non-GAAP Non-GAAP metrics are an alternative method used to measure the earnings of a company. Many companies report non-GAAP earnings in addition to their earnings as calculated through generally accepted accounting principles(GAAP). disclosures. These filings leave room for the management to exclude expenses or line items to suit their narrative.
Also, the company has refuted

speculations speculations TechCrunch SoftBank cuts internal valuation of $10 billion Oyo to $2.7 billion Read more  about valuation markdown, saying the reports are “patently incorrect”.

Gaurav covers the money trail around everything startups and internet economy. A graduate from the University of Delhi, he joined Institute of Chartered Accountants of India before finding his way to research and journalism. Apart from being a petrolhead, he pretends to be Ari Gold on weekends.
Aayush covers businesses that are primarily Internet for The Ken. In his previous stint at Goldman Sachs, he spent slightly more than a year analysing investment opportunities in the China Internet space. A science graduate, he completed his postgraduate from the Indian Institute of Management, Kozhikode. Write to him if, among other things, you wish to talk about e-businesses, journalism or just offbeat career choices.
Read this story. Subscribe Now
This story is available across both editions. Subscribe to the one that’s most relevant for you. Questions?
Premium
$ 120 10% off
$ 120 10% off
$ 120 /year
$ 120 /year
Borderless
$ 199
$ 199 /year
Echelon
$ 299
$ 299 /year
Buy access to this story
Get access to just this story for a year
$ 20
Just sign up for free. Experience The Ken
No end date. No credit card required

Read some of our best free stories
Experience The Ken’s offering and products
Sample our premium newsletters for 14 days
Unrivaled analysis and powerful stories about businesses in India and Southeast Asia from award-winning journalists. Includes access to longform articles, premium newsletters across a range of topics depending on your interest and our top-ranked podcast. For those who want to be prepared for what comes next.
Decode the most significant shifts happening around business, technology, startups and healthcare. All told through a combination of original reporting, beautifully visualised data and infographics, and delivered as a compelling narrative story.
Our subscribers include executives and leaders from the world’s most successful companies, students at top post-graduate campuses, and smart, curious people who want to understand how business is shaping the future of India and Southeast Asia.
Articles are generic, almost cookie-cutter in their approach. And they don’t provide enough context on the issues they cover. The Ken is different. I don’t always agree with everything they say but I appreciate their commitment to publishing deeply reported narratives and investigations. Their reporters find new ways to analyze tech among other industries. And that’s always worth a read.
A personal subscription to The Ken was a no brainer. But as startup founders, this isn’t enough. Team members also need to be in the know, for everyone handles customer-facing responsibilities and an ecosystem change that impacts customers also impacts us
The policy & execution is in quite a mess. the flip flops on KYC, the insidious use (& abuse) of consent, the hopeless competition with zero-balance Jan Dhan accounts – all brought out starkly. Congratulations!
that shape our understanding of businesses around us. With placements around the corner, Ken is a great resource to prepare and ace our interviews.
Access all new and older stories for your edition
Get access to our subscriber-only Android and iOS apps
Engage with the subscriber community
Early and exclusive access to The Ken’s products
What kind of subscription plans do you offer?
We have three types of subscriptions
– Premium which gives you access to either the India or the Southeast Asia edition.
– Borderless which gives you complete access to The Ken across both editions
– Echelon which gives you complete access to The Ken across both editions along with a bonus gift subscription

What do I get if I subscribe?
The Premium edition gives you access to stories in that edition along with any five subscriber-only newsletters of your choice.

The Borderless and Echelon subscription gives you complete access to The Ken across editions and unlimited access to as many newsletters as you like.
What topics do you usually write about?
We publish sharp, original and reported stories on technology, business and healthcare. Our stories are forward-looking, analytical and directional — supported by data, visualisations and infographics. We use language and narrative that is accessible to even lay readers. And we optimise for quality over quantity, every single time.

Our specialised subscriber-only newsletters are written by our expert, award-winning journalists and cover a range of topics across finance, retail, clean energy, cryptocurrency, ed-tech and many more.
How many newsletters do you have?
We are constantly adding specialised subscriber-only newsletters all the time. All of these are written by our team of award-winning journalists on a specialised topic.

You can see the list of newsletters that we publish over here.
Does a Premium subscription to your Indian edition get me access to the Southeast Asia edition? Or vice-versa?
Afraid not. Each edition is separate with its own subscription plan. The India edition publishes stories focused on India. The Southeast Asia edition is focused on Southeast Asia. We may occasionally cross-publish stories from one edition to the other.

We recommend the Borderless or the Echelon Plan which will give you access to stories across both editions.
Do you have a mobile app?
Yes! We have a top-rated mobile app on both iOS and Android which allows you to read on-the-go and has some amazing features like the ability to bookmark stories, save on your device, dark mode, and much more. It’s really the best way to read The Ken.
Is there a free trial?
You can sign up for a free account to experience The Ken and understand our products better. We’ll send you some free stories and newsletters occasionally, and you can access our archive of previously published free stories. You can stay on the free account as long as you’d like.

The vast majority of our stories, articles and newsletters can be accessed only by a paid subscription.
Do you offer any discounts?
Sorry, no. Our journalism is funded completely by our subscribers. We believe that quality journalism comes at a price, and readers trust and pay us so that we can remain independent.
Do you offer refunds?
No. We allow you to sample our journalism for free before signing up, and after you do, we stand by its quality. But we do not offer refunds.
I am facing some trouble purchasing a subscription. What can I do?
Just write to us at [email protected]the-ken.com with details. We’ll help you out.
I have a few more questions. How can I reach out to you?
Sure. Just email us at [email protected] or follow us on Twitter.
Check out our FAQs for all the answers to everything.
Or
Download the Ken App and unlock the full potential of The Ken.
@NatesanSiv Been glued to The Ken for a while now. Gives you all you need to know in a non traditional language both concise and to the point. Well done @TheKenWeb
@Climateabhi @TheKenWeb gives personal touch to each and every mail subscriber newsletter, makes reading so engaging and connected! Platforms like The Ken are revolutionizing the way financial/business journalism is done in India.

Verification Code has been sent to your Email address
Sorry, our free subscriptions require a real email id, because that’s how we send you our daily stories. Please enter a valid email.

Account Detail Updated
Please Wait …
Delete Account?
Are you sure you want to delete ()?
On deletion the user will become free starter
Emails has been sent

We’ve sent your invite. Continue adding your teammates to your subscription here?

Enter the email address that you’d like us to send this payment link to. This could be your HR, finance representative, or anyone from your organization. A copy of this email will be sent to the team’s admin as well.

Email Sent Successfully
Corporate pricing applies to teams of 5 or more members only.

Thank you. We have received your request to post comments. You’ll hear from us soon.
Are you sure? Your subscription will expire at the end of your current subscription period.
Automatic payments successfully cancelled. You will not be charged again.
Your order invoice has been resent to your billing email. (You may have entered a different email than the one you’re logged in with)
Please upgrade to a paid account first
Are you sure? Canceling automatic payments can not be undone.
You’ve got access!
Deepak Shahdadpuri has unlocked this article for you


Sponsor Details
Loading user data
We’ve emailed your gift link. Want us to send some more?
The Ken has invited you to sign up for The Nutgraf by The Ken.
The Ken has invited you to sign up for The Nutgraf by The Ken.
Having your name allows us to address you personally in emails and on our website. That’s all, nothing else.

The Ken has added you as a partner. Read The Ken as a couple. Sign in to get started.
The Ken has added you as a partner. Read The Ken as a couple. Sign up to get started.
Having your name allows us to address you personally in emails and on our website. That’s all, nothing else.

See all results for .

Or share through your address book:
Gmail
Outlook
Choose friends to share with
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Viraj Soni
[email protected]
Emails sent to your friends.
Welcome to The Ken
As a part of the Learning and Development program at Myntra-Jabong, you have complete access to 300+ original daily stories over the next year, 500+ previously published stories and our comment sections. Also, do keep an eye out for our exclusive subscriber-only iOS and Android apps which will be rolled out for you shortly.
Happy Reading!
We’ll get back to you within 2-7 working days .
We welcome contributors from journalists, subject matter experts, and anyone who has a good story to tell.
Activating your subscription
Or

source

Leave a Comment