Oyo, an Indian budget hotel chain, may have lost a substantial portion of its business to the pandemic but is moving closer to finding a new investor: Microsoft.According to two sources familiar with the matter, Microsoft is in advanced stages in talks to invest in Oyo. It is not clear what the size and value of the investment will be. Oyo was valued around $10 billion in 2019, but SoftBank, a major Indian investor, had reduced the Indian startup valuation to $3 billion earlier in 2019.One source said that Oyo could also be shifting to Microsoft's cloud services. The matter is confidential and both sources requested anonymity.Ritesh Agarwal, chief executive officer at Oyo and founder of Microsoft, declined to comment on Thursday evening.Agarwal stated that the Indian startup had laid off thousands of workers globally earlier this year when countries around the globe enforced lockdowns. However, it still has $780 million to $800 millions in its bank. The bank had approximately $1 billion of startup funds in December 2020.He said that the pandemic struck the startup like a cyclone earlier this month. He said that after building something for many years, it only took 30 days for the pandemic to drop by more than 60%.Oyo announced that it had raised $660m in debt earlier this month. According to TechCrunch, the debt was used for the repayment of the existing debt.It will be Microsoft's latest investment in an Indian startup if the deal goes through. In the past, Microsoft has supported a few startups including DailyHunt, a news aggregator, and a short-video platform.
