Ola Will Reduce 350 Employees For IPO Preparation; Operations Will Be Restructured
Uber competitor Ola, which has reported a substantial increase in revenues of 16%, and reduced losses by cutting off driver incentives, will now reduce employee strength.
And the reason is IPO filing.
What all will change in Ola for IPO?
Keep reading to find out..
Ola Will Reduce Employee Strength By 350
As per reports coming in, Ola will reduce their staff strength by 5-8%, which will impact 350 employees.
These 350 odd employees will not be terminated, but moved to their sister concerns like Ola Electric which received $1 billion funding from SoftBank, and Ola Financial Services, which has some ambitious plans related with fintech market.
The employee strength at Ola will be reduced, so that it complies with the IPO requirements. The company is planning to go public in 18-20 months.
Ola employees around 4500 employees, overall.
Major Operations Restructuring Will Be Done
Besides reducing staff size, Ola will also employ major operations restructuring.
Some of the technical operations will be consolidated, and new processes will be introduced, to ‘sharpen’ their focus on ‘revenues and profitibility’.
In an email to all employees, Harish Abhichandani, Ola Group chief financial officer said, “As a business, we need to exercise sharper focus on metrics like revenue, growth, and profitability. We also need to refresh the way we run our daily operations — processes, people, productivity. Hence, a redesign of our organisation and processes is the need of the hour,”
Mention of IPO and going public has been avoided in the email.
Ola’s Sound Financial Health Is A Good Sign
In the financial year 2019, Ola reported an increase in revenue to Rs 2,155 crore, which is an increase of 16%, compared to last year.
At the same time, their losses have narrowed down to Rs 1158 crore, which is almost 50% less, compared to the last fiscal year.
London has already approved Ola Cabs’entry into their city, while rejecting Uber.
This seems to be the most optimized phase for Ola to jump into public listing of their company, and take itself to another level.
We will keep you updated, as we receive more updates.