Indian hospitality unicorn Oyo is planning to lay off thousands of employees from its India and China businesses. According to media reports, the company has let go of 5% of its 12,000 employees in China partly citing non-performance as the reason and dismissed 12% of its 10,000 staff in India, one of the people close to the source said. Oyo plans to shed another 1,200 in India over the next three to four months.
As per a Bloomberg report, Oyo is undergoing a restructuring, trimming redundancy in China and India, leading to thousands of dismissals, said by people familiar with the developments, requesting not to be named because they aren’t authorized to talk to media.
“We continue to be one of the best places to work for and one of the key reasons for this has been our ability to consistently evaluate, reward and recognize the performance of individuals in a meritocratic manner, and enable them to improve their performance,” Oyo said in a statement to media.
In the recent past, Oyo has been facing challenges for some time. There are reports claiming hotel owners in China are protesting in front of the company’s offices, accusing the startup of violating contractual agreements.
Masayoshi Son‘s SoftBank has called for greater financial discipline among the founders in his portfolio, spurring job cuts at smaller outfits, and Oyo’s downsizing is turning out to be another setback for SoftBank, whose portfolio has been buffeted by recent trouble at WeWork. The growing turmoil may complicate SoftBank’s efforts to raise a successor to the Vision Fund, the world’s largest pool of startup investments.
Oyo had helped build the startup ecosystem in India, inspiring many young entrepreneurs, but recently its reputation has suffered a setback due to customer complaints about bad experiences along with grievances about unfair practices from several of the more than 20,000 hotel owners in its chain.