NEW DELHI: It is now official — Ola has raised $1.1 billion in funding led by Tencent Holdings and is likely to soon mop up an additional $1 billion. The app-based transport aggregator firm’s statement, however, was silent on the valuations at which funds were raised.
Existing investor SoftBank and its other US-based financial investors had also participated in this round, Ola said. Tencent Holdings Ltd is a leading Internet company in China, which Ola said “…will bring significant expertise to further its leadership position across the mobility market in India.”
“The transportation and mobility industries are seeing huge changes globally. Our ambition is to build a globally competitive and futuristic transportation system in India that will support and accelerate a nation on the move,” Ola co- founder and CEO Bhavish Aggarwal said in the statement.
The new fund is expected to be invested by Ola to strengthen its hold in Indian market and to keep its rival Uber at a distance. Ola said that it will make strategic investments in supply, technology and innovations in addition to artificial intelligence and machine learning capabilities to meet India’s unique transportation needs.
Both have big plans for India and have already introduced driver incentives and discounted rides for customers. It has operations across 110 Indian cities. It is important for the firm to keep investing despite suffering a consolidated loss of over Rs 2,311 crore — about Rs 6 crore a day — recently due to heavy advertising and promotional expenses. Existing investor SoftBank, in addition to other US-based financial investors like ANI Technologies, Tiger Global, Accel Partners and Sequoia India, had also participated in this round, Ola said in a statement.