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$1.1 Billion Invested by Tencent, Softbank In Ola - Uber's Biggest Rival In India

$1.1 Billion Invested by Tencent, Softbank In Ola - Uber's Biggest Rival In India
Investors that include Chinese internet giant Tencent and Japan's SoftBank has helped Ola, Uber's fiercest rival in India, raise $1.1 billion in a recent round of funding for the Indian ride hailing company.
The requisite firepower to continue fighting Uber in one of the world's largest mobile markets will be given by the funding to the Indian ride-hailing service.
The total amount of the funding would likely be in the funding round would be just over $2 billion as Ola has also revealed that it is also in advanced talks to raise another $1 billion from different investors. A source familiar with the situation told the media that following the close of the round, Ola will have a valuation of around $7 billion.
It will use the money to invest heavily in artificial intelligence technology and penetrate new areas of the country, said the start-up which is present in 110 cities across India.
Given the troubles that Uber is going through at the present moment, timing of the deal could work in Ola's favor. After founder Travis Kalanick stepped down following a series of scandals, the $70 billion ride-hailing app has recently installed a new chief executive Dara Khosrowshahi. The company has also been having its own power struggles in the boardroom.
But the importance of the Indian market has been previously noted by Uber. It would invest $1 billion in India that year, the company had said in 2015.
Still, by trying to create localized products, Ola has been battling hard against its American rival. For example, transportation modes popular in large Indian cities such as rickshaws and motorbikes can be hailed by the users of Ola. And by launching similar products in India, Uber has also followed suit.
heavyweights with a lot of cash are presently backing Ola. For example, similar start-ups to Ola such as Indonesian ride-hailing app Go-Jek have seen Tencent investing a lot of money in. Chinese firm Mobike, which offers bikes for rent via a mobile app, is also on the list of investments for the company.
And Softbank has also been investing in the ride-hailing sector. With a large stake in Didi Chuxing in China, the company has also recently invested in Grab, Uber's rival in Singapore.
According to a source quoted in the media, Ola will focus on boosting its leasing business with the new money. In order to boost supply, the ride hailing company leases cars to drivers who want to drive for Ola. Investments in electric cars would also be possible for the company by the funding
Even though it is not ruling out moving into foreign markets, but ahead of moving into international markets, the company is prioritizing expanding across India, said the media quoting people with knowledge of the matter.
"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," Bhavish Aggarwal, co-founder and CEO of Ola, said in a press release Wednesday.

Christopher J. Mitchell

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