Technology

Zen Rooms, the budget hotel network startup founded by Rocket Internet, had faced the deadpool earlier this yearafter a prospective funding deal collapsed, but now the business appears to have found a home. Korea&sYanolja, a popular motel brand that has branched out into app-based hotel bookings, has made a strategic investment that could see it fully acquire the business.

Ten-year-old Yanoljais initially paying $15 million for an undisclosed &strategic non-controlling stake,& but it will retain the rights to buy 100 percent of the Zen Rooms business. Zen Rooms clarified that the acquisition is an option and not based on performance or financial metrics.

Founded by a former hotel worker, Lee Su-jin,Yanoljais best known for its lovel hotels although it is trying to clean up the general image of short-stay hotels by promoting them as destinations for business travelers, tourists and families, as noted by a Bloomberg profile story. The company has also grown its own app-based booking service which among the most used in its homeland with 20,000 rooms.

The company is reportedly planning an IPO, so expansion is on its mind.

For those reasons, Zen Rooms fits that new focus. The company borrowed the budget hotel model, first pioneered by SoftBank-backed Oyo in India, and brought it to Southeast Asia when it launched three years ago. The concept is simple, Zen Rooms guarantees minimum standards at all hotels including free WiFi, fresh towels and bedding, hot showers, etc all of which is controlled via a mobile app. Those standards are normal to most hotel stayers, but when traveling in the East, standards can vary wildly especially at budget hotels, which Zen Rooms is focused on.

For hotels, Zen Rooms manages the brand — and sometimes more — and it allows helps them tap the internet to find customers and bookings.

Today, Zen Rooms is active in six cities in Southeast Asia — it had previously alsorun operations in Brazil, Hong Kong and Sri Lanka — across which it claims to operate1,000 hotel franchisees with an inventory of more than 7,000 rooms. Its rivals in Southeast Asia include Red Doorz, which raised $11 million earlier this year.

The startup has raised $8 million from investors to date, includinga $4.1 million Series A last Aprilthat was led by KoreaRedbadge Pacific and SBI Investment Korea with participation Asia Pacific Internet Group (APACIG), the joint venture fund in Asia between Rocket Internet and Qatari operator Ooredoo.

However, TechCrunch understands that a major funding deal of over $10 million fell apart in Q1 2018 which left the company with arapidly depleting runway. As a result and as TechCrunch reported in March, the company was aggressively shopped to potential buyers, investors and rival companies in order to keep the business afloat.

Yanoljahas come to the rescue but a full buy-out looks like it will be dependent on the companyfuture performance, such is often the arrangement with strategic deals made with a view to full ownership. Rocket Internet, which remains a major investor in Zen Rooms, will hope that the deal goes as smoothly as Lazada, its e-commerce service that is now owned by Alibaba.

Lazada ran out of capital in similar circumstances in early 2016 and Alibaba, the Chinese internet giant, came to its aid with a $1 billion investment. Although that was a majority investment it wasn&t a full-on buyout.Alibaba later increased its holdings until it fully owned the business, and today it is a key part of the firmoverseas expansion strategy.

Already, TechCrunch understands from one source that Zen Rooms has gone on a hiring spree in recent weeks after it closed the deal. It had earlier been forced to make cutbacks to its team as a result of cost-cutting following the collapse of the funding deal earlier in the year.

&We now have the capital to invest,&ZenRooms co-founderKiren Tanna told TechCrunch. &Thedeal has been in discussion since earlier this year….we are treating like an acquisition but this is step one.&

Tanna added that the company plans to focus on five markets in Southeast Asia, and an expansion to Vietnam may be in the pipeline soon.

The tech gods and goddesses must adore procrastinators, because we were suddenly compelled to extend our early-bird pricing on passes to Disrupt San Francisco 2018. It kills us to see folks paying more than necessary, so you now have until August 1 at midnight PST — another full week — to get your tickets and experience all the tech and VC goodness that Disrupt San Francisco 2018 has to offer. Don&t put it off; go buy your tickets today.

Our most ambitious Disrupt event takes place at our new, larger venue, Moscone Center West, on September 5-7. If you haven&t heard, this will be our only Disrupt event in North America this year, and we&ve gone all-out to make these three days special and value-packed.

Startup Battlefield is always frenzied excitement, but this year, we super-sized the stakes. The grand prize $100,000 in non-equity cash. The competition will be fierce, and we can&t wait to see how it all goes down.

We&ve gone global with a Virtual Hackathon, which features thousands of the worldbest tech-heads, coders, designers and programmers hacking some incredible creations and competing for a $10,000 grand prize. And thanks to our generous sponsors, we have a bunch of amazing hack contests that offer thousands of dollars in cash and prizes.

Every Disrupt offers an incredible list of speakers, and this year may stand out from the rest. We&re particularly excited to have some of the top women in the VC world grace our stage. We&re talking Megan Quinn, a general partner at Spark Capital; Sarah Tavel, Benchmarkfirst — and so far, only — female general partner; and Aileen Lee, who coined the term Unicorn and has formed her own company, Cowboy Ventures.

Whether you&re a founder, an investor, a marketer or a job-seeker, you won&t find any better place to network than Startup Alley. Our exhibition floor features more than 1,200 early-stage startups showcasing a range of technological goodness with a particular emphasis on these 12 categories: AI, AR/VR, Blockchain, Biotech/Healthtech, Fintech, Gaming, Privacy/Security, Space, Mobility, Retail or Robotics/IoT.

Founders and investors can make their networking a whole lot easier by using CrunchMatch. Thatour free business match-making service that connects early-stage startup founders and investors who share similar business interests and profiles.

Disrupt San Francisco 2018 takes place on September 5-7. So many great reasons to go, and now you have one extra week to buy your pass. Early-bird pricing ends on August 1 at midnight PST. Depending on which type of pass you choose, you can save up to $1,200. Don&t pay more than necessary. Buy your tickets today.

Google confirmed it has issued a strike againstInfowars founder Alex Jones& YouTube channel for breaking the video platformpolicies against child endangerment and hate speech. Four videos were also removed. The strike means Jones& channel will not be allowed to live stream for 90 days.

In a statement emailed to reporters, a Google representative said &We have long standing policies against child endangerment and hate speech. We apply our policies consistently according to the content in the videos, regardless of the speaker or the channel. We also have a clear three strikes policy and we terminate channels when they receive three strikes in three months.&

According to The Verge, two of the deleted videos contained hate speech against Muslims, a third had transphobic content and the fourth showed a child being shoved to the ground by a grown man with the headline &how to prevent liberalism.&

The fact that four deleted videos only amounted to one strike against Jones& channel has prompted scrutiny of YouTubemoderation policy, with critics arguing that each video that breaks the platformrules should warrant its own strike, especially for prolificrepeat offenders.

Jones& channel was issued a strike in February for a video promoting the conspiracy theory that survivors of the Parkland, Florida shooting, which killed 17 people, were actually &crisis actors.& But strikes expire after three months, so the Alex Jones channel currently has only one active strike against it.

While he promotes ideas that are ridiculous and hateful, Jones is influential and Infowars has helped promulgate many pernicious conspiracy theories. For example, he is currently being sued by family members of Sandy Hook victims for claiming that the mass shooting, which killed 27 people, including 20 small children, was staged. Since the shooting in December 2012, victims& families have been targeted for harassment by conspiracy theorists.

The YouTube strike come a few days after Facebook refused to take down a video of Jones ranting against Robert Mueller, in which he accused the special counsel of committing sex crimes against children and mimed shooting him. Facebook told BuzzFeed News that Jones& comments in the video, which was posted to his verified page, did not violate community standards because they are not a credible statement of intent to commit violence.

TechCrunch has also contacted Infowars for comment.