Ola Cab Business Model | How Ola Earns | Case Study

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Ola is an transportation company founded on 3 December 2010. It is an Indian based startup while Uber is an working internationally. Ola is managed by ANI Technologies Pvt Ltd. Lets know about ola cab business model.

Founder – Ola

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Source

Founded by Bhavish Aggarwal a graduate from IIT Bombay. He was a computer science student and has also worked for Microsoft for 2 years. The idea of ola came up during travelling and ended the ride with a bad experience.

How It Works?

Ola cab is basically a source between you and the cab driver. As in 2018 the company has expanded in 150+ cities and has a network of 10 lac+ vehicles.

  • Working on App-centric model.
  • Detects you location through GPS.
  • Show cabs of different categories – mini, sedan, prime, sharing.
  • Just click on Ride Now.
  • An Automatic request is generated by ola servers to the driver connected with the ola.
  • If he/she(driver) accepts your request you will get all the details of the driver through a confirmation message or call.
  • For more coordination you can call Driver
  • Payments – Can be made online or pay after ride.

How Ola Drivers Earn Money?

Ola pays the driver on the basis of incentives . The Trip commission varies from 10-20% depending on cities. For example is the fair price for travelling 8km is Rs800 (including GST). If the Ola commission is 15% = 800*15%=Rs120. So the driver payout will be 800-120=Rs680.

Ola Into Limelight

In 2017-18 ola cab business model faced huge loss of 2300 crore due to many reasons like first ride free, ride for 1km with Rs6. Some deep reports they paid drivers around 381 crores, Spended 481 crores in advertisements And spended 120 crores in technology And the left money was paid in high incentives. In this financial year they paid less incentives so with this the persons who were earning around 1 lakh are now earning around 40k. In 2015 ola acquires TAXIFORSURE and in november 2015 they acquired GEOTAGG – a technical software to measure distance.

Investors

Ola has around 29 investors. Some of the top investors are CEECF, Softbank, Accel Partners, Mauritius Investments, Tiger Global Management, Matrix Partners, Steadview Capital, Sequoia Capital . It is also known as the third highest consumer of internet in india with a valuation of $6 billion.

We can say that ola made a revolution from auto rickshaw to cabs. In such a busy life ola has been an integral part of everyones life . Hats off to Bhavish Aggarwal for making Ola Cab Business Model most loved business model.

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