After WeWork, OYO is another rude shock for SoftBank's Son

In less than a year after the WeWork fiasco, Masayoshi Son, the CEO of Japanese conglomerate SoftBank, is now staring at another troubled startup – the Indian hospitality firm OYO.

The firm has been forced to freeze operations around the world and has been furloughing thousands of employees, media reports have said. Travel has come to a halt, leaving hotel rooms empty and losses rising for the nascent company. Follow our LIVE coverage of PM Modi's address here

The Ritesh Agarwal-backed company, once touted by Son to overtake the biggest hotel chains in the world, is now facing an existential crisis in the wake of the coronavirus pandemic.

In a highly unusual move, Agarwal borrowed $2 billion to buy shares of OYO as the valuation soared, with a personal guarantee to financial institutions from Son.

Amid OYO's dismal operations, Son's $2 billion promise could be in jeopardy as banks may call for more collateral if the hotel chain’s valuation drops any further. This could result in personal losses to both Son and Agarwal.