Oyo Hotels slashed about two-thirds of the shares it planned to sell in an initial public offering, a move by its founders trying to close the sale after tech stock valuations plummeted.

The once-prominent company is preparing to file a new initial public offering as soon as this week, two people familiar with the matter said. Oyo will outline plans to sell only a third of its planned new shares, eroding the amount of new capital it expects to receive, one of the people said in the filing.

The plan shows how founder Ritesh Agarwal, 29, is pushing for an IPO on weaker terms to ease the financial pressure on the hotel and accommodation booking company and himself. While the travel market has improved from pandemic-era troughs, Oyo was once valued at around $10 billion as its Airbnb counterpart in India continues to report mounting losses. Meanwhile, Agarwal took on billions of dollars in debt to increase his stake in the company.

Things are still fluid, and Agarwal or Oyo may still fine-tune their goals. It is the SoftBank Group Corp-backed startup’s second attempt at an IPO after India’s stock market regulator raised multiple red flags in an early effort in late 2021. Tech companies’ valuation has since fallen after accelerating inflation, and rising interest rates drove away customers, cut spending and stoked fears of a potential recession.

Current investors in Oyo are not selling any shares, the people said. SoftBank owns about half of the startup, formally known as Oravel Stays Ltd, which also counts Airbnb Inc as a backer.

The company was targeting a valuation of around $9 billion and updated its IPO filings in early 2022. SoftBank slashed its Oyo valuation to $2.7 billion later that year. The IPO valuation, which will be finalised through the book-building process closer to the listing, is far from what the company initially envisioned.

Agarwal, his holding company RA Hospitality Holdings and SoftBank Vision Fund remain the company’s top three sponsors, and its 2021 prospectus is unchanged, one of the people said. In 2019, with the support of SoftBank founder Masayoshi Son, Agarwal borrowed $2 billion from the Bank of Japan in his personal capacity, increasing his shareholding to 33%, with a valuation of $10 billion.

Agarwal and Oyo’s SoftBank-dominated boards are desperate to push for an IPO despite a hostile environment for tech IPOs over the past 18 months, with repeated failures by Indian startups, one of the people said. It would be a way to prove to Japanese lenders that the founder and his startup are still worth billions of dollars.

When Agarwal married in Delhi this month, Son made a rare trip from his Tokyo headquarters to join the festivities, accompanied by a group of SoftBank executives.

While Agarwal is not required by law to detail his personal debts in a draft IPO prospectus, he has been warned that regulators could still view them as an investment risk and hold indefinitely or reject them on other technical grounds, one of the people said.

Oyo’s business shows signs of recovery after the pandemic hammered the travel and hospitality industries. The startup has reinvented itself as a technology company, moving away from an asset-heavy, capital-intensive model spanning multiple continents that cost billions of dollars and deteriorating relationships with hotel owners, and sparked court disputes.

Agarwal founded Oyo in 2013 after dropping out of college. He had the backing of SoftBank Masayoshi Son at age 21, and the Japanese billionaire then took the founder under his wing, providing him with mentorship and later personal financing for his billions in debt.