Ola Becomes $6 Bn Unicorn With $74 Mn Funding From Steadview Capital

SUMMARY

Ola raised the funding via allotting preference shares to Steadview Capital

It recently raised $1.9 Mn via allotting preference shares to China’s Eternal Yield

Ola is considering raising more funds to contain SoftBank's influence

Homegrown online cab aggregator Ola is now reportedly worth $5.5- $6 Bn after it raised $74 Mn (INR 520 Cr) from its existing investor, a Hong Kong-and London-based hedge fund, Steadview Capital, through preference shares.

Steadview Capital will now receive 245,082 preference at a subscription price of $301 (INR 21,250) per preference share, according to a company filing accessed by Inc42.

This development comes a week after the company raised $1.9 Mn (INR 14 Cr) via allotting preference shares to China-based electric vehicle company, Eternal Yield International, at a price of $208 (INR 14,603) per share.

Till date, Ola has raised a total of $3.974 Bn in funding and counts investors such as Softbank, China Eurasian Economic Cooperation Fund, Sailing Capital, Temasek Holdings, SoftBank, Tencent Holdings, Tekne Capital., among others

Ola has raised funds from its investors other than Softbank to curb the Japanese tech conglomerate’s influence. Earlier reports suggest Softbank, which currently owns 26% shares in Ola, is looking to invest $1 Bn in the company. However, speculation is rife that Ola may consider accepting only a smaller amount from the Japanese investor.

In its bid to put a stop to SoftBank’s growing stake in the company, Ola had earlier amended its Articles of Association to include a clause that prevents Softbank from buying more shares in Ola without the approval of company’s founders and its board.

The company was also said to be in talks with Flipkart cofounder Sachin Bansal, African internet conglomerate Naspers LLC, and Singapore-based sovereign wealth fund Temasek to raise funds.

Meanwhile, this is also the latest investment by Steadview Capital. It has earlier invested in wealth management fintech startup INDWealth, home services startup UrbanClap, and online platform for home furnishings startup Urban Ladder.

Additionally, Ola is seeing its losses mount to over $695 Mn (INR 4,897.8 Cr), although its total income grew 70% during FY16-17 as compared to the previous fiscal. The company reported a loss of $447 Mn (INR 3,147.9 Cr) in FY15-16.