Ola Electric raises $200 million at $5 billion valuation

Ola Electric has raised over $200 million in fresh funding from a clutch of investors including Tekne Private Ventures, Alpine Opportunity Fund and Edelweiss at a valuation of $5 billion, the company said in a statement on Monday.

The funding comes less than four months after the startup had garnered a similar amount of investment from SoftBank, Falcon Edge and others at a valuation of $3 billion. Ola Electric has so far raised close to $800 million in equity funding, according to data sources from market research firm Venture Intelligence.

The fresh capital will bolster Ola’s ambitions in the electric mobility space as it looks to launch a suite of new products including electric bikes and cars going ahead. “Ola Electric is creating India’s EV revolution and is driving cutting edge manufacturing from India for the entire world. With Ola S1, the best scooter ever made, we’ve changed the entire scooter industry and are now looking forward to bringing our innovative products to more two-wheeler categories including bikes as well as cars,” says Bhavish Aggarwal, founder & CEO at Ola.

Ola Electric, which operates in the premium high-speed scooter space, has played its strategy right in terms of building its R&D, manufacturing capabilities, infrastructure suite as well as sales and after sales services, says Suman Jagdev, Partner, Automotive, at Praxis Global Alliance.

“When it comes to R&D, Ola’s product has positive attributes. Ola’s scooters are ones with the highest range on a single charge,” says Jagdev. Besides, the company has also been able to put in place a rich bouquet of product features like seamless app connectivity, touch screen dashboard, voice control command and navigation.

“Ola has also invested in developing home charging solutions and has stitched a sales network with wide reach. We are positive on the company’s ability to gain scale,” says Jagdev.

Ola Electric was spun off into a separate entity in 2019. The EV maker, which turned unicorn in 2019 with a $250 million financing from SoftBank, also managed to sign a $100 million long-term debt financing agreement with Bank of Baroda last year, touted as the largest in the Indian EV industry.

Jagdev says the domestic two-wheeler EV industry will grow into an estimated 13 million two-wheeler units market by FY30. E-bikes and high-speed scooters are expected to see aggressive growth. “The government subsides have made cost of two-wheeler EVs competitive compared to conventional two wheelers,” adds Jagdev.

Over the last 12 months, Ola Electric has built the Futurefactory in Tamil Nadu’s Krishnagiri district, which the company claims to be the world’s largest two-wheeler manufacturing facility. Ola Futurefactory will employ over 10,000 women at full capacity. Ola Electric has reportedly delivered 111 S1 and S1 pro electric scooters till December 30.