Brief: SoftBank, Tencent invest $2 billion in India’s Uber rival Ola

Photo credit: Tech in Asia.

The news (extracted from Bloomberg):

• India’s ride-hailing company Ola has raised US$2 billion in fresh funding from SoftBank, Tencent, UC-RNT Fund, a venture capital fund jointly run by Indian biz tycoon Ratan Tata and the University of California’s investment arm, and some institutional investors from the US, according to Bloomberg sources.
• The funding round wasn’t yet complete and Ola’s current valuation wasn’t available. In its previous funding round, Ola was valued at US$3.5 billion, 30 percent lower than its peak value of US$5 billion in November 2016 when it raised US$330 million from SoftBank, UC-RNT, and Falcon Edge Capital.
• The latest investment round in Ola would be the second largest for an Indian startup. Flipkart scored a total funding of around US$4 billion from SoftBank Vision Fund, Tencent, and others this year.

Why it matters:

• The fresh funding comes at a time when Ola’s chief rival Uber is distracted by multiple lawsuits, including charges of sexual misconduct and trade secret theft, as well as a boardroom tussle.
• While Uber has been growing aggressively in India, going neck-to-neck with Ola, fighting multiple battles seems to be taking a toll elsewhere. According to data from app measurement company App Annie, Grab takes the lead in most parts of Southeast Asia, except in Indonesia. Uber doesn’t win any country by its MAU count, it said. Uber has also been exiting some of its markets like Russia and Taiwan.
• Recently, Ola joined hands with a bunch of Indian startups like Flipkart, MakeMyTrip, Quikr, and Hike Messenger to launch Indiatech.org, an industry body to lobby for the interests of homegrown companies over global rivals.