Oyo slashes salaries of executive team, Ritesh Agarwal takes 100% pay cut

Indian travel and hospitality sectors have taken a hard knock due to the COVID-19 pandemic and many Indian startups in the segment are slashing salaries across levels to conserve cash and extend their runway. 

SoftBank-funded Oyo is no exception as it has slashed salaries of executives at senior and top-level. According to the company’s statement, its founder and CEO Ritesh Agarwal has taken a 100% pay cut while the entire executive leadership took a voluntary pay cut beginning at 25%.

Many senior team members are opting for an additional uncapped amount, and some going up to 50% to enable building the runway for the company, the release added. “Given the current business situation, which is unprecedented for our industry globally, I am foregoing 100% of my salary for the rest of the year,” Agarwal said.

The pay cuts at Oyo has come at a time when several companies in the travel and hospitality sectors had already executed layoffs and slashed salaries. MakeMyTrip and Ixigo slashed salaries significantly while TravelTriangle and Fab Hotels executed layoffs to counter the challenges amid the lockdown to stop the spread of the COVID-19 pandemic.

Although Oyo hasn’t decided to lay off staff at this time, the SoftBank-backed company had reportedly fired about 5,000 staffs globally in the past three-four months to control burn and bring efficiency. Like other hotel brands, its business in the 80 countries it operates in, including China, has been witnessing less than 20% occupancy rate for several weeks.

Binny Bansal-backed Acko has also laid off about 50 employees and slashed salaries at senior level. Entrackr had exclusively reported it on Wednesday. Several founders including Aloke Bajpai, Deep Kalra, Varun Dua and many others have foregone their salaries.

Over the past two weeks, the Indian startup ecosystem is preparing for the crisis that no one thought of. Entrepreneurs are seeking advice from investors and other stakeholders to deal with the fallout and figure out the path ahead.