One of the co-founders of Flipkart could be readying a $100 million investment in Ola
Sachin Bansalis said to be preparing a $100 million investment in the cab-hailing firm, according to a report in the Economic Times.
- Last month, Ola raised raised $50 million from a state-backed Chinese investment fund and a Hong Kong-based private equity firm, giving it a valuation of over $4 billion.
- Ola is looking to raise fresh capital to facilitate its overseas expansion plans and boost its domestic food delivery business.
The $50 million investment last month gave Ola a valuation of over $4 billion. It came as part of the ride-hailing firm’s plan to raise $1 billion in fresh capital to facilitate its overseas expansion plans as well its boost its food delivery business and continue its domestic rivalry with
The UK launch in August 2018 was speculated to be a precursor to an eventual expansion into other European markets. The company plans to be operational in 50 major cities across the world by next year.
Meanwhile, Bansal is flush with cash and is looking for ways to spend it. While the Ola investment represents a change of pace from his relatively modest investments in the past, he is said to be mainly interested in taking significant stakes in early-stage companies at the moment.
The 37-year old earned close to $1 billion from the sale of his 5.5% stake in Flipkart to Walmart. The transaction was completed in August. Bansal left the Indian e-commerce company shortly after Walmart’s takeover of Flipkart was finalised in May. According to media reports,
Ola will reportedly facilitate Bansal’s investment through the issuance of new shares and in smaller measure, the sale of existing shares. The deal represents a melding of two of India’s foremost entrepreneurs - Bansal and Bhavish Agarwal, the CEO of Ola.
Agarwal has reportedly been engaged in a tussle with the cab service’s main investor, Softbank, since May for control of the company. Bansal is likely an ally in this regard, as Agarwal needs fresh funding but doesn't want to raise it from Softbank, because that will increase the Japanese company's stake.