After giving a tough fight to Uber in the Indian market, Ola is looking to test international waters. Last month, it was reported that Ola was planning to launch its services outside of India. As of now, Ola is eyeing expansion in neighbouring countries like Sri Lanka and Bangladesh.
Apart from this, the company is also looking for expansion in other countries in Asia and North Africa. As per the LinkedIn account of one of the members of the talent acquisition at Ola, the company is currently looking for operations experts in Dhaka and Colombo.
The Ola Uber Battle
Ola’s arch nemesis Uber has been in both the markets for a while now. While Uber launched its Sri Lanka operations in December 2015, it entered the Bangladesh market in November last year. In India Ola’s reach is far more than Uber. Ola is present in 110 cities and claims to offer over 700K vehicles. While Uber is only present in 29 cities in India. After the United States, Uber is present in the most number of cities in India.
Ola’s expansion plan comes on the heels of a recent round of funding from Tekne Capital. As per reports, Ola raised about $36 Mn (INR 231 Cr) funding round from New York-based hedge fund Tekne Private Ventures. The funding was raised through an issue of preference shares.
Since November 2016, Ola has raised close to $404 Mn, as per disclosures made with the RoC. The funding round of $350 Mn raised in February 2017 took its valuation to about $3.5 Bn. Later in June, the cab booking platform reportedly picked up about $50 Mn funding from hedge fund Tekne Capital Management, as an extension of its ongoing round.
Earlier in July 2017, it was reported that Ola was in talks with Chinese Internet conglomerate Tencent for a $400 Mn funding. Towards the end of July, cab aggregator Ola’s shares saw a 12% markup in its valuation by investor Vanguard.
Ola incurred a consolidated loss before tax of $360 Mn (INR 2,313.66 Cr) in FY16, as per regulatory filings with the Ministry of Corporate Affairs. A year earlier, the company’s losses were about $123.9 Mn (INR 796 Cr).
As per regulatory filings, the consolidated revenue for ANI Technologies Pvt. Ltd (Ola’s parent company) was about $117.9 Mn (INR 758 Cr) for the year ended March 2016. The revenue is inclusive of subsidiaries such as Ola Fleet Technologies and TaxiForSure parent Serendipity Infolabs. In the previous year, this number was about $16.1 Mn (INR 103.8 Cr).
While Ola has been dealing with increasing losses to compete with Uber, the US-based company is crumbling at the edges too. Uber’s CEO Travis Kalanick resigned under pressure from investors. Later in July, Uber called it quits in the Russian market. The cab aggregator announced a $3.7 Bn merger deal with Russian rival Yandex.Taxi, which is owned and operated by Baltic search engine giant Yandex. Last year in August, Uber decided to sell its China arm to rival Didi Chuxing. In India too, the company was plagued by driver protests over reduced incentives. Another setback was the Delhi government’s proposed ban on ride-sharing services like Ola Share and UberPOOL under the Motor Vehicles Act, 1988.
Just yesterday, it was reported that Silicon Valley VC firm Benchmark Capital, one of the earliest investors in Uber, has filed a suit against ex-CEO Travis Kalanick accusing him of fraud, breach of contract and breach of fiduciary duty.
In the Indian market, the Government of India is also looking to enter the online cab aggregator market. With its sights set on entering the neighbouring markets of Bangladesh and Sri Lanka, Ola will automatically be pitted against Uber. However, it remains to be seen, when will the Bengaluru-based company formally mark its entry in both the markets.