A Year of OYO Japan – reflections on launching ambitious startups in one of the world’s most fascinating markets

A Year of OYO Japan – reflections on launching ambitious startups in one of the world’s most fascinating markets

As we enter 2020 and approach the first anniversary for OYO in Japan, this marks a good time for us as a team to reflect on our accomplishments and learnings over the past year. 2019 was a milestone year for us – OYOpreneurs from varied backgrounds, multiple countries, companies and cultures came together to launch and grow OYO in Japan. Starting out of conference room thanks to our friends at SoftBank and Yahoo! Japan, getting our companies registered, opening a bank account, hiring our first OYOPreneur in Japan, signing our first property to welcoming our first guest – it has been a truly humbling journey and we are thankful to all our partners, guests, investors and OYOpreneurs.

Of cup noodles and family-run ryokans 

We started our operations in Japan in 2019 with the launch of a website, an unknown but a revolutionary one. With the dream that like Nissin made Ramen easy, “instant noodles”, can we make housing easy, “instant chintai”. Just like Ramen says, ‘add hot water’, why can’t it be, ‘just come with your clothes and gadgets’? There was even a fork in that cup noodles. Our homes have forks, knives, spoons, chopping boards, frying pans, kettles, fridges – everything. Go, book a home now, just do it.



We were so encouraged by the initial response (100 homes with 114% occupancy due to advance bookings) and the encouragingly positive SNS chatter (“black ship is here”, “Amazon of chintai” etc.) that we aspired to grow to 1 million homes. A “north star” that would guide us to build a truly scalable mass housing operation, instead of yet another monthly mansion competitor. While we didn’t launch a million homes (not yet!), it taught us that fridges can be sourced 35% cheaper, that running warehouses is not easy and what truly matters is understanding different types of supply – their location, quality and price.

So, next, we worked towards putting OYO LIFE on the Tokyo map. Literally! 7000+ homes, at an average 7-minute walk from 700+ train stations. While we had a lot to list, furnish and sell, it truly gave us a glimpse into our market potential and the infinite demand that already exists. We understood our cost structure, our profit potential, our expenses and our unit economics. Meanwhile, our dedicated technology teams in Tokyo and India launched robust platforms and seamless micro-services, allowing us to think farther and execute better. Never-seen-before products, built for OYO by OYO.


OYO Hotel Sankoen


Right about the same time, in April 2019, we also started our hotels operations in Japan, OYO Hotels Japan GK (OHJ), formed as a joint venture between OYO Hotels and Homes, SoftBank KK and Softbank Vision Fund. Through this business we brought to this high-potential hospitality market, our successful proposition of combining design, hospitality, and technological expertise, financial acumen, revenue management and operational capabilities, that has truly helped our asset partners transform their hotels, and offer good quality customer service, thereby significantly increasing occupancy and profitability – in every OYO building. It was time for  ‘instant shukuhaku shisetsu.’ Even today, many hotels and ryokans (traditional Japanese lodges) are family-run in Japan and in the absence of property management technology, family successors who would be the next generation operators and increasing labour costs, everything that OYO learnt in other markets, became increasingly relevant to Japan.

All this would not have been possible without the amazing team of OYOpreneurs, working as true professionals, often going ‘above and beyond’ their call of duty. Through 2019, our team grew from a handful of people sitting in a one-room office to a team of ~800+ people in multiple offices across Japan, from Sapporo in the north to Fukuoka in the south. In a short span of 12 months, OYO has built a leadership team comprising individuals with highly distinguished backgrounds. These leaders bring with them invaluable experience and knowledge from industry giants, such as Google, Microsoft, Bloomberg, Coca Cola, Uniqlo, Bain & Company, McKinsey, Amazon and Netflix, to name a few.

Making changes 今 (now) to build businesses for 後 (later) 

Early in our journey, like most startups, we saw tremendous growth potential and set some ambitious targets. We also faced some challenges but unlike many others, we learned a lot along the way and had the courage to apply our learnings and hit the reset button, when needed. We swiftly turned our widespread operations into a fully focused effort. In our long-term housing rental business, we exited strategically identified keys, merged functions, simplified processes, drove tech-enabled synergy, and enhanced efficiency. We switched from less brainstorming and meetings to more timely decision making and razor-sharp execution.



With OYO Hotels Japan, we invested significantly in technology, in order to improve our booking experience for customers. In June 2019, in less than 100 days of our launch in Japan, we partnered with TL Lincoln for a smooth and hassle-free connection with local OTAs. And some of our hotels have also received multiple awards from our local partners, including Rakuten travel.

Our OYOpreneurs, and all our leaders have time and again demonstrated that we do not shy away from facing challenges or changes. We remain agile, we take hard decisions if required, we can run on a war footing and we remain committed come what may. Even though it’s been just a year, we have come a long way from our ‘launch’ and ‘expansion’ modes. We have switched gears to stay focused on becoming a truly promising enterprise that is slowly scaling its product strategy and operational excellence.

Breathe. Twice.

What you just read above is typical of what happens in startups. Especially very ambitious ones. Lots of ups and downs, changing decisions, hard work, slacks and emails, whatnot. And, of course, a fun learning experience like no other.



Does OYO work in Japan? Let’s ask our customers. 


While we learnt a lot in 2019,  what truly matters are the two powerful red lines below:


OYO LIFE  began 2020 by hosting 4000+ customers in our first month of the year.


Think about that for a second.


4000 people in the world’s most populated city trust us with their housing. An essential service that they spend 30% of their monthly income on. And a product they experience for at least 30% of their 24 hours, every single day. Oh and also, they are paying only a tad bit higher than what they would have paid renting their own home. It’s a win-win for everyone. The homeowner, the customer and us.


And OYO Hotels too is on track to host 4000+ daily guests before it’s first anniversary




Even though we are less than a year old, OYO Hotels is today Japan’s #1 most widely present brand of hotels available in 73 cities with 200+ hotels transformed for clean, comfortable rooms at surprisingly low prices.


Hotel owners have been emphatic in their support for OYO – and that is the engine that drives our teams. Today, the majority of OHJ partners are satisfied with our services and speak highly of the on-ground support we provide. We have recently launched a call center in Japan as another means to support our hotel partners.


We have received first-hand, many heart-warming testimonials. For example, one of the hotel partners was unequivocal in its appreciation of our associates on the ground and told us “The associate’s support was flexible and was very good”. While another hotel was keen on its appreciation of OYO’s benefits. “Customers from online travel agents have increased”, they said. It is these kinds of feedback that provides us with the zeal to surge ahead.

2019 was the year to learn and to experiment while being bold yet frugal. 

2020 is the year.

We will first aim to be profitable with the products we have, then we will invent, test and scale the next version of our business modes to finally end the year with more homes, hotels, asset partners and more customers. And to achieve this, we are going to re-organize ourselves, forward invest in building core competencies and continue to focus on our three key strategic objectives not just in Japan, but globally- sustainable growth, operational excellence and customer experience, and people, culture and governance.


By Kavikrut, Board Member – OYO LIFE, JAPAN & Prasun Choudhary, Board Member – OYO HOTELS, JAPAN

Meet the author / Kavikrut .

Kavikrut is the Chief Growth Officer at OYO and he is also the Board Member for OYO LIFE, Japan He joined the company in 2014 and since then has played an instrumental role in expanding OYO's network across India. Kavikrut holds an MBA from the Harvard Business School and an MSc in Finance from BITS Pilani. An ardent biker and traveller, he loves photography and volunteers at INDUS ACTION, a Delhi based non-profit organization that he founded with his Harvard classmates.