India's Ola raises $250m down round

Ani Technologies, Ola’s parent, issued preference shares to SoftBank Internet & Media Inc. (SIMI) last November, according several local media reports citing documents filed with India’s Registrar of Companies. Live Mint added that the company has been trying to raise new capital since last June and is in talks with investors over a further injection of at least $500 million.

Also last November, SoftBank marked down the value of part of its investment portfolio, including holdings in Ola and Indian e-commerce platform Snapdeal. A mutual fund managed by US-based Vanguard Group followed suit in February. SoftBank led a $210 million Series D round for Ola in 2014 and later participated in follow-on rounds for the company.

Ola’s most recent investment came in November 2015 when Baillie Gifford led a $500 million round that also featured existing backers such as SoftBank, Falcon Edge Capital, Tiger Global Management, DST Global and Chinese peer Didi Kuaidi. It took the company’s total private market funding to $1.3 billion.

Founded in 2010, the Ola platform offers taxis, luxury vehicles, auto-rickshaws and shuttle buses. It claims to have more than 450,000 vehicles at its disposal across 102 cities. The company is said to have facilitated a weekly average of six million rides in the last three months of 2016. However, it faces growing competition from Uber, with subsidies eating into earnings as they battle for market share.

Last week e-commerce giant Flipkart became the first of India’s unicorns to confirm a down round as Microsoft, eBay and Tencent Holdings committed $1.4 billion at a post-deal valuation of $11.6 billion. The valuation was $15 billion when the company last received fresh capital in 2015.

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• Topics
• South Asia
• Expansion
• Technology
• India
• TMT
• Growth capital
• Softbank