Putting an end to market speculations, India’s home-grown cab aggregator Ola has announced a US$1.1 billion in fresh funding led by Chinese internet giant Tencent. Existing investor SoftBank and a few unnamed US-based financial investors also participated.
Ola is currently in advanced talks with other investors to close an additional US$1 billion as part of the current financing round, concluding a total raise of over US$2 billion, as per a statement.
With its latest round of funding, Ola will be making strategic investments in supply, technology, and cutting-edge innovations to build for the country’s unique transportation needs. It will also make significant technology investments into Artificial Intelligence and Machine Learning capabilities.
Bhavish Aggarwal, Co-founder and CEO of Ola, said, “The transportation and mobility industries are seeing huge changes globally. Our ambition is to build a globally competitive and futuristic transportation system in India that will support and accelerate a nation on the move. Our new partners share our passion for building the future of transportation in India together and we look forward to learn and benefit from their global perspectives and ecosystems.”
Ola, founded in Jan 2011 by IIT Bombay alumni Aggarwal and Ankit Bhati, is an online cab and auto rickshaw booking platform. Using the Ola app, users across 110 cities can book from over 800,000 vehicles. The Ola app is currently available on Windows, Android and iOS platforms.
Two years ago, Ola raised US$500 million in its Series F round of funding, led by UK-based investment firm Baillie Gifford. Existing investors Falcon Edge Capital, Tiger Global, SoftBank Group, and DST Global, aside from Chinese mobile transportation giant Didi Kuaidi, had also participated.
In December 2015, leading on-demand taxi hailing companies Didi Kuaidi, Ola, Lyft and GrabTaxi joined forces to give global giant Uber a run for its money. Under this partnership, the four taxi-hailing leaders would enable international travellers to access local on-demand rides by using the same application, even if they use in their respective countries. Through this, the firms aimed to cover a major part of Southeast Asia, India, China and the US, starting in the first quarter of 2016.
The company has been locked in a bitter battle with Uber, which has aggressively been expanding in India, the second fastest-growing market in the globe, ever since its arrival to the Indian streets in 2012. Ola had several run-ins with the US company over nationality and pricing, and both also had some fights with the government over regulatory hurdles. Last July, Ola alleged that Uber was attempting “to trivialise a horrific” rape incident involving its driver by dragging the Mumbai-based firm into the controversy.
Both the firms claim supremacy over others, but most users have now started preferring Uber for the quality of services and the fleet.
Uber has also raised the bar by incentivising drivers and offering promotions to customers.
Uber recently introduced uberMOTO, which aims to give riders motorcycle ride at the push of a button, through the Uber app. Riders receive driver and bike details just as they do for other Uber rides, as well as all standard safety features before, during and after the ride including GPS tracking, two-way feedback and the ability to share trip details with family and friends. Uber also recently launched its food delivery service UberEATS in India, which enables registered users to order food from its partner restaurants and get it delivered at their home.