Bhavish Aggarwal is choking Ola - The Morning Context

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• By all accounts, the way he absorbs knowledge and learns things, his attention to detail is a sight to behold. On the other hand, insiders also say he is distrustful, insists on signing off on the smallest of details, can’t focus on one thing for too long and keeps moving from one project to another.

• The problem is that Bhavish wanted the deliveries yesterday. He is the kind of man who thinks it is possible to have a child in one month by getting nine women pregnant.

• “Can you imagine creating the kind of hype that Ola created around the electric scooter without even having a product? But Bhavish did it.”

• He didn’t just do it. The noise he created drew attention to the entire segment. Awareness of other electric two-wheeler brands like Bengaluru-based Ather has increased because of Ola.

• Ankit Bhati, Aggarwal’s batchmate from IIT Bombay, co-founded Ola and was chief technology officer. According to media reports, he distanced himself from the company’s day-to-day functioning in 2019, apparently unhappy with being sidelined from Ola Electric.

• “Bhavish hired people, doubled their salaries and gave them an unrealistic timeline,” says this executive. “People told him it wasn’t possible, but he wouldn’t listen. He fired them instead. So the rest of them lied. That’s what has led to the launch debacle.”

• So why the hurry, you may ask. First, because it is the nature of the CEO, and second, because the cab business is no longer hot, and nothing else he has tried has worked so far. It is evident in Ola’s valuation, which has been stuck in the $6 billion range for the past two years. Ola Electric, an entity not owned by Ola, is now valued at $5 billion, making it Aggarwal’s ride out.

• So it is a matter of survival that Ola finds other businesses. It has tried multiple things over the years: cabs, autos, two-wheelers, aggregation, manufacturing, food, finance, the list goes on. But outside cab-hailing, nothing has scaled up well.

• Over time, this toxic culture became common knowledge, but people still joined because there was a real problem to solve and the salaries were out of this world.

• For Aggarwal, his company is his to control. Famously, in 2016, he turned down a billion-dollar investment from SoftBank because he didn’t want to be put in the same position as Snapdeal, where SoftBank as an investor tried to push the struggling e-commerce startup to sell to larger rival Flipkart.

• Ola is reportedly looking to raise over $500 million in debt from US investors, joining the likes of Byju’s and Oyo, who have also recently tapped this market for debt through instruments known as “term loan B”. But the company still needs fresh equity capital and an exit for long-time investors.

• “To run a business, you need to take care of three types of people: the supplier, the employees and the customer. You need to have all three sections, or at least two of them, love you,” says the first former executive. “In Ola’s case, people in all these sections hate the company. It is working because it has the money. The day Bhavish can’t raise any more will be the end of them both.”