Ola Electric gets $250 mn from SoftBank, becomes India’s newest unicorn

Ola’s electric vehicle arm, Ola Electric Mobility has secured a funding of over Rs 1,725 crore (about $250 million) from SoftBank, according to regulatory documents.

With this latest infusion, Ola Electric Mobility (OEM) has joined the list of unicorns in India that includes names like Flipkart, Zomato, Paytm as well as its parent, Ola.

As per regulatory documents filed with the Registrar of Companies, OEM issued “4,326 fully and compulsorily convertible series B preference shares of the face value of Rs 10 each having the rights, privileges and preferences…” to SB Topaz (Cayman) Ltd.

The total amount paid was about Rs 1,725.04 crore, it added.

The allotment was made on Tuesday following a special resolution passed by the board members on June 25, the filing showed.

SoftBank is also the single largest investor in Ola.

In May, Tata Sons Chairman Emeritus Ratan Tata – who is also an investor in Ola – had invested an undisclosed amount in OEM as part of series A funding round.

Also as part of the series A, OEM had announced raising Rs 400 crore led by Tiger Global and Matrix India in March this year.

Ola Electric is currently running several pilots involving charging solutions, battery swapping stations, and deploying vehicles across two, three and four-wheeler segments.

OEM was initially established to enable Ola’s electric mobility pilot programme in Nagpur.

In 2018, Ola announced ‘Mission: Electric’ to bring 1 million electric vehicles on Indian roads by 2021.

The Series B financing round, details of which emerged in a filing to the local regulator on Tuesday, valued Ola Electric at $1 billion, a source familiar with the matter said.

The infusion comes as New Delhi looks to take a serious step in electrifying the existing fleet of cabs and scooters in the country as it attempts to curtail air pollution and carbon emissions. The country has set an ambitious goal to convert 40% of the fleet to electric by 2026.

Just so it happens, Ola has been working on electric vehicles for several years. The company is currently running several two-wheeler and three-wheeler electric vehicles pilot programs across the nation. It is also building charging infrastructure and swappable battery systems for these vehicles.

Ola Electric, which raised $56 million earlier this year, plans to bring 10,000 e-vehicles to the road by end of this year and deploy a million similar vehicles over the coming years. The parent group, which raised $300 million from Hyundai and Kia to expand its mobility solutions and electric vehicles programs as part of an ongoing Series J round earlier this year, is also partnering with original equipment manufacturers to scale the EV business.

The active participation of SoftBank in Ola quells speculations that the Indian firm was trying to distance itself from the conglomerate fund. Ola Electric has become the first EV business in India to gain unicorn status. A company spokesperson declined to comment.

The firm, which already has a presence in the UK, New Zealand, and Australia, last month announced that it will set shop in Uber’s backyard. Ola said it will build a new advanced technology center in San Francisco and employ more than 150 engineers there.

“As we think of the next decade, we want to invest in and we want to be very relevant on the global scale business front as well as building new-age, cutting edge technology which impacts the new age business model of the future, there is no better place in the world to do it than here in the Bay area, we have made a small start, we will be hiring close to around 100-150 people here this year and from there we will take it beyond,” Ola cofounder and CEO Bhavish Aggarwal said at a recent conference.

Uber, meanwhile, currently has little to no electric vehicles play in the nation. Just two months ago, it partnered with electric bicycle sharing platform Yulu to conduct a trial in Bangalore. Globally, however, Uber ATG spans out of the San Francisco-headquartered firm and raised capital for its self-driving business. China’s Didi is reportedly eyeing going the same route.

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