Update: SoftBank Internet and Media Inc (SIMI) has officially confirmed (pdf) that it is leading a $210 million into Olacabs along with existing investors. As part of the deal, SIMI CEO and former Google executive Nikesh Arora will be joining the company board.
Along with Olacabs, SoftBank Group also confirmed that it is investing $627 million into the online marketplace Snapdeal. The company has reportedly committed an investment of $10 billion into India’s information technology (IT) and communications segment.
Earlier (Oct 27): Online cab booking service Olacabs is raising $210 million investment from SoftBank Corp at valuation of nearly $1 billion, reports The Economic Times citing sources. It says the investment is expected to be announced this week when SoftBank Chairman Masayoshi Son is visiting India. We’ve written to Olacabs for a confirmation and will update the story once we get a response. The company however has declined to comment on this to the publication.
Interestingly, this investment comes just three months after it raised Rs 250 crore from investors like Steadview Capital and Sequoia Capital and participation from existing investors Tiger Global and Matrix Partners.
Olacabs co-founder and CEO Bhavish Aggarwal had then mentioned that they are using the capital to expand to newer cities & categories and was hoping to have a presence in at least 20 cities by the end of this year. The company currently offers taxi bookings for 19 Indian cities include Bangalore, Mumbai, New Delhi, Chennai, Goa, Hyderabad and Ahmedabad among others and claims to have over 30,000 cars on its platform.
Earlier this month, Olacabs had also started enabling users in Mumbai to book Kaali-Peeli taxis. The company had claimed that over 2,000 Kalli Peeli taxis had already registered on the Ola platform and they hope bring over 20,000 Kaali-Peelis to its platform by the end of this year. The service is limited to South Mumbai at the moment but Olacabs plans to roll out the service across Mumbai over the next year. That being said ..
OlaCabs raises $200 Mn. Congrats team @Olacabs. Hope a significant chunk of this goes in improving the Consumer Experience.
— PJ (@BeingPractical) October 25, 2014
Investing in building driver ecosystem: Besides geographical expansion, Aggarwal had mentioned that they were also planning to use the investment to strengthen its driver ecosystem in the country and had earmarked Rs 100 crore investment towards this initiative over the next one year.
Excluding the SoftBank’s reported investment, Olacabs has raised an overall investment of $105 million across four different rounds. This includes undisclosed Series B investment from Tiger Global and Matrix Partners in November last year and undisclosed Series A funding from Tiger Global Management in April 2012. It had also received angel funding from investors like Rehan Yar Khan and Shaadi.com group founder Anupam Mittal among others in April 2011.
Competition: Olacabs currently competes with Google Ventures-backed Uber that currently offers services in 10 Indian cities and Bangalore-based TaxiForSure that had raised undisclosed amount of Series C investment from Accel Partners US and existing investors Bessemer Venture Partners & Helion Venture Partners in August this year and is currently available in 12 Indian cities.
Other players in this segment include Meru Cabs, Inventus Capital Partners-backed Savaari Car Rentals, TaxiPixi and Blume Ventures-backed BatchCar. JustDial had also introduced online cab bookings in August last year.
SoftBank investments: Softbank has been fairly active in India. The company is reportedly leading a $650 million investment into the online marketplace Snapdeal. It is also reportedly in talks to invest $300 million into the mobile-focused marketplace and digital wallet service Paytm. Back in September 2011, SoftBank had also invested $200 million into the mobile ad network InMobi.
More recently, it had formed a joint venture with Hollywood studio Legendary Entertainment, focused on providing digital content across mobile platforms with a particular focus on India and China. It had also formed a mobile internet joint venture with Bharti Enterprises that runs Airtel called Bharti Softbank (BSB) in October 2011. This venture currently operates three mobile ventures including mobile messaging app Hike, mobile gaming venture Tiny Mogul Games and location-based deals service Hoppr.