India based cab aggregator company Ola, in a move to inch further closer to its competition, has expanded its services internationally. The company has started on-boarding private hire vehicle and driver partners in Sydney, Melbourne, and Perth in Australia. The announcement comes after seven years of operations within the country.
“We are launching Ola in Australia and see immense potential for the ride-sharing ecosystem which embraces new technology and innovation there, ” said Bhavish Aggarwal, Co-Founder & CEO, Ola. This would be the first international market that Ola will explore and plans to expand further to countries like New Zealand, Sri Lanka and Dhaka.
Late entrant, stiff competition
Ola’s global rival Uber is already in the Australian market. The European company, Taxify, also launched services in Australia in December last year. As a means to attract drivers, Taxify is charging a 15 percent commission from drivers, lower than the 25 percent being charged by Uber. Ola is yet to reveal its commission and pricing schemes. As of December, Uber already has 82,000 drivers attached to its platform.
Ola in India
Funding: USD 3 Billion
Total rounds of funding: 14
Users: 125 million
Driver partners: 1 million
Rides: 1 Billion annually
Time to profitability: 2019
Performance in India so far?
After starting operations in 2011 in Bengaluru, Ola services are currently available in 110 cities in India. The company claims to have over 125 million users and the network of over one million driver partners. It further claims that annually the company has more than a billion rides taken using its platform.
In terms of funding, the company has raised 14 rounds of funds with a total amount of USD 3 billion. However, the company is still not profitable. According to a valuation report on the company in March last year, the company will achieve profitability in 2019 and have USD 1 billion profits by 2021. In the last disclosure made by the company to the Registrar of companies, Ola’s revenues grew seven times, however, losses incurred were Rs 2313.66 crore.
Ola on an expansion and diversification mode
Ola has been on an expansion and diversification mode since last year. The company also recently acquired Foodpanda, from Delivery Hero Group. Ola plans to invest $200 million into FoodPanda India, which is currently available in 100 cities in India. This diversification also comes close to heels to a time when Uber launched UberEats in India.
Other than this Ola has also started new categories last year such as rentals and outstation. It has also started monthly Ola Share passes.
Interestingly, after a series of issues and backlashes faced in the last year from the drivers over lower incomes as well as consumers over unavailability of cabs, this year seems to be picking up. According to a RedSeer report, the online cab aggregator industry witnessed an increase in the consumer booking experience in the third quarter of last year.
The firm says this was due to stabilization of supply and other operational metrics over time.
“The industry witnessed a slight improvement in cab availability, and a fall in the driver-side cancellations resulting in an improvement in the overall consumer booking experience,” the firm added. The report says that consumer experience is by 400 bps from the previous quarters.