Funding story
The battle for the taxi aggregator and commutation solutions market continues to get hotter. With Uber and Ola fighting over the hugely expanding and potential-laden India market, the stakes continue to rise. Ola Cabs, market leader, laid down the marker recently by raising $500 million in Series F funding fron new investor Baillie Gifford and existing backers Falcon Edge, Tiger Global, Softbank Group and DST Global. That it will leave no stones unturned to challenge its key rival Uber was proven by the involvement of strategic investor and China-based anti-Uber aggregator Didi Kuaidi.
Ola vs Uber-the clash of the titans
Ola CEO Bhavish Aggarwal says that this latest round of funding is aimed at ensuring further and more dynamic expansion of the market leader, whose big advantage over key rival Uber is its excellent understanding of the Indian market, and its superb value-added services, such as “Ola Share”(a ride-sharing feature), “Ola Prime”(which allows for business class-level services) and “Ola Money”(a digital wallet which became standalone recently). While Ola’s core services have expanded by leaps and bounds, the ones just mentioned are still in their infancy, and Bhavish & Co. are likely to use this funding to propel these exciting services across the country. Ola also said recently that over 1 million booking requests are being clocked by its app each day. With its core services being accessible across over 102 cities, Ola can truly be considered to be a market giant.
The latest funding is a follow-up on a $400 million Series E in April, and has ensured a total sum of $1.4 billion being raised. Meanwhile, Uber has recently injected approximately $1 billion into its India-based business. However, its services are currently available only in 22 cities. Ola thus has an overall lead, especially in tier 3 and 4 cities. But in big cities, the gap is a lot less, and it is here where Ola expects its strategic investments and intricate understanding of the Indian market to carry the day over its global rival.
The bottom line
An ever-growing urban middle class which is in great need of effective transportation solutions, coupled with the general inefficiency of public transportation, makes the taxi aggregator segment a hugely lucrative one in India. The next few months are likely to see these market giants ramping up investments in a bid to secure an ever bigger portion of the tasty pie that is the Indian commuter’s convenience.
