IT & Web-tech News Startups

Ola had raised 384 crores from Vanguard Group in December : Report

Share on Facebook
Tweet about this on TwitterShare on Google+Share on StumbleUponShare on LinkedInPin on PinterestShare on Reddit

In a surprising unraveling, a Livemint report recently disclosed that Ola had raised $57.3 million (about 384 crores) from Vanguard Group. This was in December last year, just a month after its $500 million funding round in November.

Ola reportedly disclosed the information in documents submitted to the Registrar of Companies on Wednesday. It is surprising because the company had not announced the investment earlier and experts believe that this could have some repercussions on its image among investors.

Notably, Flipkart also went through a similar phase when its publically listed investors disclosed its investments in front of the US Securities and Exchange Commission (SEC). And after that Flipkart has been undergoing a series of markdowns by investors since then.

Vanguard Group is a renowned investor in top tech companies like Amazon, Facebook, Microsoft, Paypal, Alphabet. It controls $3.1 trillion assets under its management. In India, also Vanguard had invested in Flipkart in 2014 when it had raised $1 billion and $700 million in that year.

Indian taxi aggregator Ola was valued at $5 billion at the time of its last funding round last year. At that time, it had raised $500 million from Softbank and Didi Chuxing. Ola has not yet suffered any markdowns in its valuations yet. In fact, it is reportedly planning to raise more funds as per the Mint.

Fresh funding round the corner?

Money is raining on cab aggregators globally. While we are well aware of Uber’s ability to raise funds at a whim, same goes for its Chinese parent Didi Chuxing. Grab from SE Asia and Go-Jek from the same region have been busy filling up their pockets to fight competition. Ola also is reportedly planning to raise $300-$400 million in a fresh round so that it can compete better with Uber, here in India.

According to people familiar with the development, Ola is in talks with existing investors, Didi Chuxing and SoftBank Group, for a new round. It may later add more funds from new investors as well like it did earlier.

The fresh funding becomes even more important for Ola keeping in mind the recent turnaround of events. Case in point being the acquisition of Uber China by Didi Chuxing. This would inevitably lead Uber to focus all its efforts on India- its next major market after China.

This would be quite similar to what happened in the case of Amazon. Amazon also, after facing failure in China, turned to India with full force.

The heavy investment of Amazon in India has put Indian players like Flipkart and Snapdeal on backfoot.  To avoid a similar situation, Ola would need a serious amount of cash to match the ever increasing funds of Uber.

[email protected]

Add Comment

Click here to post a comment

Your email address will not be published. Required fields are marked *