Ola Cabs Fires 10% Workforce, CEO Hemant Bakshi Quits

Bhavish Aggarwal-led ride hailing major Ola Cabs has laid off around 10% of its workforce, or about 200 employees, in a restructuring exercise, while its CEO Hemant Bakshi has quit the startup within months of joining, sources told Inc42.

“The layoffs were in line with the company’s IPO plans and impacted employees across departments,” one of the sources said.

The development was first reported by Moneycontrol.

According to TechCrunch, Aggarwal informed employees in an email that the restructuring exercise was aimed at improving the startup’s profitability. He said Ola Cabs has made substantial investments in artificial intelligence (AI), which has led to significant cost advantages.

“… we will continue to focus on these areas to ensure that we build cutting edge products and services across our business verticals… These changes will result in certain roles within the company becoming redundant,” Aggarwal was quoted as saying in the email. 

Earlier this month, it was reported that the startup has restarted preparations for its initial public offering (IPO) and is looking to file its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) within three months for a $500 Mn IPO.

The startup is said to be in discussions with investment banks, including Bank of America, Goldman Sachs, Citi, Kotak and Axis, for its public offering. 

Meanwhile, the aforementioned sources said that Aggarwal will look after the day-to-day operations of the startup following the exit of Bakshi. He will also continue to serve as the chairman and managing director of Ola Cabs.

Before joining Ola Cabs, Bakshi had a 15 year stint with FMCG major Unilever. The startup announced Bakshi’s appointment in January this year.

Founded in 2010, Ola Cabs competes with the likes of Uber and BluSmart in the ride-hailing market in India.

Prior to the latest restructuring exercise, the startup fired employees in two layoffs rounds in the last two years. In January last year, it laid off 200 employees across Ola Cabs, Ola Electric, and Ola Financial Services.

In September 2022, ANI Technologies, the parent of Ola Cabs, fired around 200 employees from the software engineering team.

ANI Technologies’ consolidated net loss nearly halved to INR 772.2 Cr in FY23 from INR 1,522.3 Cr in the previous fiscal year. Operating revenue rose 42% to INR 2,799.3 Cr from INR 1,970.4 Cr in FY22.

Ola Cabs recently claimed that its India mobility business broke even with ‘segment-adjusted’ EBITDA of about INR 250 Cr in FY23 as against an EBITDA loss of INR 66 Cr in the year-ago period. The revenue of its India mobility arm jumped 58% year-on-year to INR 2,135 Cr in the year ended March 2023, the company said.

Meanwhile, with an eye on its public listing, Ola Cabs recently shut its operations in the UK, New Zealand, and Australia to focus on the India market.

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