Bengaluru-based cab hailing unicorn Ola has raised $11.37 Mn (INR 79.93 Cr) in fresh funding as part of its ongoing Series J round.
The news was first reported by paper.vc. According to the Ministry of Corporate Affairs filings accessed by Inc42, the funding in Ola has come in from investors such as Swedish-based DIG Investment Ab and US-based Deshe Holdings. The shares have been issued at a premium of INR 21,240 at a nominal value of INR 10. Here’s the breakdown of the investment:
- DIG Investment Ab picked up 25,858 shares worth INR 54.9 Cr
- Deshe Holdings picked up 8,314 shares worth INR 17.66 Cr
- Samih Abdel Rahman picked up 1,671 shares worth INR 3.55 Cr
- Hussam Khoury picked up 830 shares worth INR 1.76 Cr
Notably, Samih Toukan and Hussam Khoury are cofounders of Dubai-based technology investment firm Jabbar Internet Group.
The new investors onboard have an interesting combination. The investment comes in at a time when Ola has been trying to maintain balance on the board and has been reportedly trying to keep SoftBank from increasing its stake in the company.
It has been reported over the years that Ola cofounder Bhavish Aggarwal has been doing all in his might to keep SoftBank’s stake below majority. In 2017, he and his cofounder, Ankit Bhati, had went on to amended its AoA to include a clause to prevent SoftBank from buying more shares in the company without the approval of the founders and the board.
Recently, reports had surfaced that the company was looking to close another $2 Bn funding round, but was struggling to avoid SoftBank from increasing its stake in the company. The company has raised over $3.8 Bn from marquee investors such as SoftBank, Ratan Tata, Hyundai Motor Company, Kia Motors, Sachin Bansal and others.
Yesterday (July 2), Ola’s electric mobility unit, Ola Electric raised $250 Mn funding from SoftBank and joined the unicorn club. Looks like one way or another, Ola and SoftBank may not break up anytime soon.
Further, in terms of performance, Ola is now offering its services across 50 cities in India, UK, Australia and New Zealand. The company claims to complete over a billion rides annually with its over 1.5 Mn drivers.
What began as an offering of car hailing, has expanded into car pooling services and more. The company works across:
- Electric mobility unit Ola Electric
- Fleet management business, Ola Fleet Technologies
- Public transportation ticketing app, Ridlr
- Ola Financial Services that includes micro-insurance products and a range of payment solutions including a credit card
- Ola’s Food brands delivered to customers, directly from its vast network of dark kitchens
Recently, Karnataka transport department informed Ola and Uber that their carpooling services are not permissible under the present Karnataka Transport Act. Prior to this, it had pulled up Ola’s bike taxi operations.
Media reports showed that the number of daily rides of cab aggregators have increased by a mere 4%, from 3.5 Mn to 3.65 Mn in the past six months. The fall is significant as after a 97% jump in 2016, 50% in 2017 and 20% in 2018, it has reached 4% in 2019.
In terms of rides per day, the number has risen from 1.8 Mn – 1.9 Mn in 2016 to 3.5 Mn in 2018 and reached 3.65 Mn in these months of 2019. Further, it is being said that Bengaluru has seen 25-30% drop in the supply of active while ride prices have increased by at least 15-20% during non-peak hours across cities.