Ola in talks to raise $300-500 mn in new funding round
Company planning to use money to build infrastructure, especially for alternate fuelsUpdated: Nov 02, 2016 00:42 IST
Cab aggregator Uber’s main rival in India, Ola, is in talks with most of its old investors for a fresh round of funding, in the range of $300 to $500 million, a person in knowledge of the talks has said.
The cab-hailing app, which is fighting a battle of discounts with Uber to retain the number one position in the country, has been in talks for a new round of funds for nearly a year since it got $57.3 million in its last round of funding in December 2015.
Another person with knowledge of the discussions said that ANI Technologies, which owns Ola, is planning to use the money “to build an ecosystem of mobility” that includes adding more vehicle-makers as partners, on the lines of the existing Mahindra and BMW, training more drivers and working with state transport authorities to build sufficient alternate fuel infrastructure.
The company wants partnerships with carmakers to extend beyond investment or just buying cars. For example, Ola’s partnerships with German luxury carmaker BMW was to offer luxury cars on demand.
With Mahindra, the partnership was to get all Mahindra cars and services such as insurance, finance and maintenance, and work together to increase the use of electric vehicles in India.
It also offers shared rides and outstation travel. During rains it deployed boats in flood-stricken cities.
However, the second source said that the deal is far from being cemented.
Ola has so far raised $1.23 billion in eight rounds from 20 investors, including Softbank, Matrix Partners, Accel Partners and individual investors. The company is in talks with most of the venture capital firms that have invested in the company earlier. A Bloomberg report said Softbank will lead the new round as well.
The fresh round of funds, according to one news report, will suffice for Ola for the next 18 months.
Uber is not far behind. The company has already invested more than a billion dollars. HT had reported in August that it has plans to pump in another billion – an easy investment for the American ride-share company after it stopped burning cash in China.
Ola covers 102 cities in the country compared with Uber’s 28, and has 450,000 vehicles.