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Last Updated : Jul 16, 2019 05:46 PM IST | Source: Moneycontrol.com

OYO acquires Innov8, targets 50 centres by end of year

OYO already has 21 workspaces with 16 being live under the brand Innov8. The company has introduced two more brands -- Powerstation and Workflow.

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SoftBank-backed OYO on July 16 announced its multi-brand approach to the workspace opportunity in India, a few months after acquiring co-working startup Innov8 and is targeting 50 centres across the country by the end of 2019.

OYO already has 21 workspaces with 16 being live under the brand Innov8. The company has introduced two more brands -- Powerstation and Workflow.

While Innov8 is upper mid-scale, Powerstation is mid-scale and Workflow an economy co-working brand.

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Currently Innov8 is spread across six cities - Delhi, Noida, Gurgaon Bengaluru, Chandigarh and Mumbai - with over 6,000 employees of brands like Swiggy, Paytm, Pepsi, Nykaa, OLX, Lenskart, amongst others.

Powerstation has one centre in Gurgaon with over 1,000 seats and Workflow has set up four centres across NCR, Hyderabad and Bangalore with a hosting capacity of over 1,500 seats already.

The entire initiative will be led by Rohit Kapoor, the chief executive officer of the new real estate businesses.

The company will charge Rs 6,000-10,000 per month as rentals for every seat across these centres.

Co-working spaces being a $20 billion business opportunity in India by 2020, presents an incredible avenue for OYO to leverage these capabilities and create a dominant brand in this industry.

"It will take 65-70 percent of occupancy for every centre to become unit economic positive," Kapoor told Moneycontrol. He, however, declined to share the investment required for this project.

In March, the company had announced a commitement of Rs 1,400 crore for the India and South Asia market. According to Kapoor, this expansion will be a part of this commitment.

"Armed with insights and technology, we are bullish on growth in the coworking space. Given our experience in the hospitality industry and investment in core competencies that have helped us scale so fast in the hospitality, housing rental and banquet services business, we believe we are uniquely placed to leverage to create a strong offering for the corporates looking for space as a service," he added.

The development happens at a time when the company is learnt to be in talks to raise its next round of funding at a valuation of around $12-12.5 billion.

Even founder Ritesh Agarwal is in talks with early investors Sequoia Capital and Lightspeed Venture Partners to buy back shares.

The company last announced a strategic investment from US-based home-renting company Airbnb in April. Before that, it raised $1 billion from investors including SoftBank, Didi Chuxing and ride-hailing firm Grab, among others.

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First Published on Jul 16, 2019 04:45 pm
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