“In striving to achieve something big in the electric vehicle industry, Bhavish Aggarwal aspires for the global stage,” says Neha Singh, co-founder of Tracxn Technologies, a Bengaluru-based company that tracks start-ups. However, after some initial successes, “Ola still has to go a huge distance to make EVs a mass market in India.”
Aggarwal says he wants to build businesses with lasting impact, even if that means rubbing some people the wrong way. He says India can outpace its rivals not only by making cheaper electric vehicles but also by cultivating a global footprint in 5G, green energy and sustainable mobility. Progress towards these goals, he said, is “the standard by which the world should judge us”.
“There is no major success without sweat and tears,” he says.
A “quick learner”
After earning an engineering degree and a stint at Microsoft, Aggarwal founded Ola in 2010 with Ankit Bhati, a classmate from the first Indian Institute of Technology Mumbai. The company, incorporated as ANI Technologies, originally provided taxis for tour groups, but soon turned to carpooling. At that time, most Indians relied on irregular neighborhood taxi services.
TVG Krishnamurthy, 78, a board member of ANI Technologies, calls Aggarwal a quick learner with the unique ability to focus on both the grass growing on the ground and the flowers atop the tree. tree.
“One Sunday we were talking and he asked, ‘What would be Ola’s share of all the mobility in India?’ says Krishnamurthy, recalling a decade-old conversation with Aggarwal. “He started marking the percentage share on the back of his bathroom door.”
Business boomed as urban Indians quickly adopted the service for commuting or running errands. When global rival Uber started operations in India in 2013, Aggarwal encouraged Ola employees to try to outsmart the Silicon Valley company on all fronts – prioritizing outreach to government officials, public relations campaigns and driver assistance services.
Former employees say the start-up was an exciting place to work at the time. Ola has enrolled over a million drivers and expanded to dozens of cities. In late 2014, Uber’s operation in India was set back by a horrific crime in which a driver was arrested and later convicted of raping a passenger. At the same time, Ola steadily increased its market share. The company attracted investors from Temasek and Warburg Pincus and expanded internationally to the UK, Australia and New Zealand.
But by then, a rift was growing within Ola, according to executives. In 2017, Aggarwal founded Ola Electric and began exploring the capital-intensive business of manufacturing electric vehicles. While he used the Ola brand for his new venture, the business was completely separate. Co-founder Bhati and almost all of ANI Technologies’ early investors were not part of the new company.
“I thought it wasn’t right to burden others when we’re going into a very different business with a very different capital intensity, leverage profile and capacity,” Aggarwal says. “That’s why investors were given the opportunity to exit. Whoever felt he wanted to invest invested.
Building the factory of the future
In 2020, Aggarwal spent much of his time building Ola Electric. Typically, electric vehicle companies take at least a few years to grow. Aggarwal wanted to cut that timeline to compete with local rivals such as Bengaluru-based Ather Energy, which spent years developing a battery and months performing quality checks on 100 initial scooters before mass-producing its design.
Aggarwal devised a much shorter schedule. In March 2021, he stood on a barren stretch of land three hours from Bangalore, describing at a media rally dreams of building a $330 million two-wheeler factory with capacity for two million electric scooters. in a few months. Aggarwal planned 10 lines with an annual capacity of 10 million scooters over two years. He hoped to export the vehicles to Europe and Latin America.
Six months later, the Futurefactory opened its doors. At the end of 2021, the company’s first scooter hit the market.
Rather than employing a dealership model, Ola Electric reached out to buyers via social media, a tactic no automaker had attempted before. Ola Electric’s manufacturing process used innovative technology, including ultrasonic friction welding to forge hundreds of connections between cells in each battery pack. On factory tours, Aggarwal liked to show off the silent assembly lines and the robots that painted the scooters.
But it didn’t take long for the complaints to pile up on social media. Aggarwal and Ola Electric’s Twitter feeds are filled with buyers upset about late deliveries, overheating batteries and scooters that catch fire. When Aggarwal recently asked his Twitter followers what cool scooter accessories they wanted, one replied “fire extinguisher”.
Within Ola Electric, employees say the culture has turned hostile over the past two years. At meetings, Aggarwal tore up presentations due to a missing page number, addressed Punjabi epithets to staff and called teams useless, according to current and former staff. Executives say meetings scheduled for an hour often lasted 10 minutes as Aggarwal lost patience with a superfluous sentence in a memo, a bent paperclip or the quality of the printing paper.
Retention is an issue, especially at the C-suite. Some executives, including former Zilingo CFO Ramesh Bafna, decided not to join Ola Electric days after formally accepting job offers. A business leader, who has since left the company, likened Ola Electric’s expectations to “having to run a marathon like Usain Bolt”, the world’s greatest sprinter.
“Not everyone is a fit for our culture,” Aggarwal says when asked about his management style. “There is no global standard on a uniform and sterile work environment.”
Bafna declined to comment.
Confront the “Big Boys Club”
So far, the boards of both companies, which include companies like SoftBank, have said little in meetings about Aggarwal’s approach to governance. But in interviews, some senior executives who have since left have raised concerns about the ethics of a stock-swap deal with a startup founded by Aggarwal’s younger brother, Ankush, who heads now the financial services unit of Ola Electric.
There are also questions about evaluation. Last year, as ANI Technologies prepared for an IPO, investors Warburg Pincus and Temasek participated in a secondary transaction, dropping the valuation from around $6 billion to $3 billion, according to three people familiar with the matter. They say early investors feel cheated. But only a few months later, after the company secured a series of first-round deals with investors including Edelweiss, ANI Technologies’ valuation soared to $7.3 billion.
Ola did not respond to questions about the acquisition or valuation fluctuations. Aggarwal did not address either issue directly, but attributes some scrutiny to jealous rivals.
“The incumbents of the auto industry are the Big Boys Club,” he says. “They left the door open for an upstart like me. My question for them is, ‘What were they doing? Why is India not leading in vehicle electrification? » ”
Ola Electric’s business challenges have become clearer recently. Scooter sales have yet to take off. Vehicle registrations fell 35% in July from June, according to Trade standard newspaper. Ola Electric sold just over 45,000 units in July based on vehicle registration data – well below what the factory can produce and below the million reservations received when reservations opened in last December.
But after supply chain disruptions and maintenance issues, Aggarwal says production is now ramping up at the Futurefactory. He highlights Ola Electric’s unique advantages, including end-to-end play in ridesharing, automotive retail financing and vehicle insurance. At a corporate event in mid-August to unveil its electric car, Ola Electric called itself the “largest electric vehicle company in India” making the “best electric scooter in the world”.
Whether Ola Electric succeeds or not, Aggarwal’s admirers seem to agree that he has turbocharged the electric vehicle market, attracting millions of dollars in investment. Despite the risks, Aggarwal says he prefers to take a long view and move forward with a lofty goal: to build millions of affordable vehicles for India and eventually the world.
“Growing up, we constantly heard that India is a developing country,” he says. “It is the destiny of our generation to change that and now is the time. I take both responsibility and opportunity seriously.