
OYO furloughs thousands of employees as revenue drops by over 50% - JumpCrisscross
https://techcrunch.com/2020/04/08/indias-oyo-furloughs-thousands-of-employees-as-revenue-drops-by-over-50/
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vishnuharidas
An ex-customer here. I had two worse experiences by booking on Oyo.

I got stranded along with my family in the middle of Bangalore city only
because I made a payment through the Oyo app and the hotel rejected check-in.

I called the Oyo customer care, talked to 4 different staff for 2 hours,
nobody takes the responsibility, neither want to resolve the problem. They
finally told me to find some other room myself, refunded my money, and left
like nothing has happened ever.

Begged to the hotel owner, got a room for that day, and then booked another
room on MakeMyTrip for the remaining two days. The hotel owner said that NO
hotels in Bangalore will accept bookings from Oyo, and this has already been
communicated with Oyo, but Oyo still accepts bookings and payments.

Oyo replaces the website/phone info of hotels on Google Maps with the Oyo
website and number, and this makes hard to contact a hotel directly. So I
always collect hotel card/number whenever I visit a hotel.

Uninstalled the Oyo app instantly. Never used Oyo since then.

Ensured that none of my colleagues, friends, and relatives are going to use
Oyo again and get cheated.

~~~
newyankee
What has happened is , a good idea which is supposed to manage both demand and
supply issue was what helped Oyo grow, i am assuming they worked very hard
with local Indian hotels ignored by bigger international sites. However like
many other startups they grew too big too fast and the pressure to justify
their insane valuation probably led to all kind of tricks as long as they can
get away with it.

Is it legal to replace Hotel info with Oyo no ? I am assuming they do it
because a lot of small hotels do not know or understand the significance and
Oyo can probably do it at scale.

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vishnuharidas
They replace the numbers on Google Maps first - either by adding the hotel for
the first time on Maps or by "claim this business" option. Everyone else
collects the data from Google Maps (or their services) and now on every
website, the hotel has Oyo's number.

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dhimes
Man, this is infuriating. What does Google say when the hotels call to correct
the information?

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vishnuharidas
I don't think hotels can do this, either the hotels don't know how to claim
the business back, or this is a part of their agreement.

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superasn
Speaking as a customer of oyo in India I've had terrible experience with them
including a lot of my friends. I've not heard a single good thing from someone
who has actually used their services so I really don't understand how they
have become such a massively successful billion dollar company.

I mean everyone posts amazing pics of their property compared to how it
actually looks but oyo was just an outright scam for me. It was as if someone
posted all together unrelated photos of something else. It was so bad that I
couldn't even locate the darn hotel after passing it like 5 times.

But then the same happened recently with my Airbnb booking too so I guess it
has sort of become a norm here. The scene is kinda bad for these hospitality
startups in India from the customer's point of view.

~~~
lotsofpulp
They have not become a successful billion dollar company.

Some kid with a story got a few dollars from SoftBank to become
Marriott/Hilton/IHG except without paying for all the quality inspectors to go
around and continuously make sure hotels are up to par.

Clearly, this business doesn’t scale and SoftBank was hoping to pawn it off on
someone before it folded, like their other ventures.

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sytelus
Just listening to Jim Chanos on his views on gig economy
([https://www.youtube.com/watch?v=StybwIP8O8k](https://www.youtube.com/watch?v=StybwIP8O8k)).
One point he makes is that companies pay a lot more on top of salaries towards
unemployment pool etc that gig economy companies don't. He basically said that
this entire gig economy is fraud based on transferring all these burden to tax
payers unlike normal companies who have normal employees.

~~~
addicted
The entire gig economy is finding legal (and in the case of Uber they didn’t
even bother with that) ways to evade regulations.

~~~
parthdesai
Or Airbnb. Or Doordash

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JCharante
Why does cheap lodging need to be subsidied by VCs? I didn't realize OYO was
such a big company, but I've booked some rooms through them and it seems like
it's just another booking source like booking.com or tripadvisor. The hotels
had different names in person than on OYO and the only OYO thing about them
was their shampoo bottles.

~~~
rchaud
They're trying to become a sole-source supplier of hotel rooms. Same with
WeWork, and Airbnb.

The middleman, taking a cut of every sale, while shifting all the risks to the
consumer and the hotelier. Great gig if you can get it.

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vishnuharidas
This is a good read: _Oyo Ruined My Anniversary:_ [https://oyo-ruined-my-
anniversary.com/](https://oyo-ruined-my-anniversary.com/)

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K33P4D
#offmychest I detest Ritesh Agarwal and his poorly run startup. They have
absolutely no culture, a friend who was working for their Bangalore sales team
told me it was a dog-eat-dog world amidst them and clearly they're a good
example of what not to do after you receive so much funding(lease properties
in vegas lmao instead of fixing your app and doing better due diligence for
the hotel listings so that some form of quality control can be expected, they
just put a big sign in front of some run-down disgusting motel which says
OYO), rose too quickly and now they have to resort to all sorts of tomfoolery
to justify Masayoshi to stay sustainable. I have no idea how they'll ride the
post corona wave when travel and hospitality have been the most hit sectors. I
pray for you man ritesh goodluck.

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martinald
I cannot understand OYO. At least in London, it is nearly all horrendous 2*
hotels which were often used for temporary emergency housing, rebranded with
an OYO logo but no significant refurbishment done. The reviews are absolutely
atrocious and I feel sorry for a tourist that books into them. It would be a
terrible impression of the city if you were a visitor.

~~~
lotsofpulp
Understand it from the point of the VC. They were trying to sell a story about
a “visionary” who could create a hotel brand without paying for the people and
infrastructure that make it all work. It takes time and money to build and do
quality control for quality hotels. That doesn’t make for 1000x ROI though.

Easy to understand when you know they were never interested in selling quality
hotel room nights, but rather trying to cash out on the equity.

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LordAtlas
Looks like the nails in its coffin are going in. Sorry, Softbank.

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KaoruAoiShiho
Shareholder lawsuit vs Softbank when?

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dannyw
You can't sue a company just because they made bad investments.

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grwthckrmstr
Had three next level terrible experiences with Oyo in India. Never using them
again for hotels

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baron_harkonnen
Why are any articles on "bad news" being systematically removed from the HN
front page?

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raesene9
Whether OYO would have done well, absent Covid-19, is a debatable point, but
in general companies who were expanding rapidly with a lot of borrowing, right
before a recession starts, do not do well.

Things like OYO and WeWork seem like they'll be particularly badly affected by
this downturn as they've got a lot of fixed costs (leases or property owned)
and their main markets will be heavily impacted.

~~~
rightbyte
Oh ye forgot about WeWork. I guess JIT office space is not a very good
business when people are supposed to work from home?

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chewz
[https://news.ycombinator.com/item?id=22802790](https://news.ycombinator.com/item?id=22802790)

[https://news.ycombinator.com/item?id=22820255](https://news.ycombinator.com/item?id=22820255)

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Jommi
>The startup’s teams in the U.S. are most impacted by the furloughs, according
to a person familiar with the matter. In a statement, Oyo confirmed the
furloughs and added that India, its home market, was not impacted

This is something Is m seeing more and more in the current climate.
International companies ar elooking to cut payroll to reduce expenses, and
ofcourse they are going tos tart with the country with the most out of
proportion salaries.

Tack on the current insane unemployment benefit package and I'm wondering why
companies aren't forloughing every person they even think they might not need.

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JackPoach
It really sucks to be in the hospitality industry right now.

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buro9
[https://archive.is/THGGg](https://archive.is/THGGg)

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justforfunhere
Anyone in the know of what is the impact on the OYO workforce here in India,
which I guess is it's biggest market and where majority of it's workforce
operates?

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achow
It is right there in the second para..

In a statement, Oyo confirmed the furloughs and added that India, its home
market, was not impacted.

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forgottenagain
In India it's difficult if not impossible to let employees go. The Indian
public will not forgive any company that fires people during this pandemic.

~~~
koolhead17
Capitalism and Morale does not go hand in hand.

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valuearb
This site breaks the back button.

