Uber India’s top rival, Ola, has raised $500 million in its latest round of funding, pushing the company’s valuation to $5 billion.
The Series F round, which was led by Baillie Gifford and previous investors Falcon Edge, Tiger Global, SoftBank Group, DST Global and Uber’s Chinese rival, Didi Kuaidi, comes after the company raised $1.2 billion last year.
“As we pursue our mission to build mobility for a billion people, we are excited about bringing on board partners who can help us get there faster,” Bhavish Aggarwal, cofounder and CEO of Ola, said in a statement.
The ride-hailing app company that currently serves over 102 Indian cities reportedly processes over a million bookings every day and has seen 3ox growth in the last year, giving tough competition to Uber, whose second-largest market in the world after the U.S. is India.
While Uber’s presence in India is limited to about 22 cities and 250,000 rides every day, it faces stiff competition from Ola, whose presence spans tier-two and tier-three cities and has, over the years, tugged at Indian consumer sentiment with its new products and marketing, spinning from its superior understanding of its domestic market.
Even though Uber recently gave its Indian arm a $1 billion dollar injection, it appears that, for now, it would still continue to play catch-up to Ola. For instance, much before Uber began offering cash payments and Uber rickshaws, Ola had already implemented those services and was successfully running them, according to TechCrunch. This month, the company also began offering a “Get a Celeb Chef On Demand” service to attract a new segment of users and, more recently, an Ola boat service to help flood victims in Chennai, India.
“We will continue to build for the local market through innovative solutions, like Ola Share, Ola Prime and Ola Money, as we grow the mobile ecosystem in India,” Aggarwal added, indicating the company’s plan to diversify its business model and revenue source.