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Ola has officially shut down operations of its TaxiForSure (TFS) business. Around 700 employees have reportedly been laid off in the process.
Ola had acquired TaxiForSure in March 2015 in a deal worth $200 million. This move was made to maintain market leadership against the fast growing rival - Uber. At the time of acquisition, Ola had made it clear that TFS would work as an independent entity. But eventually, the company started moving drivers from TFS to its own platform. This reduced traffic on TFS, thus resulting in the said shut down.
Ola claims that TFS has been integrated to the Ola platform with the launch of Ola Micro. This has thus made operating another platform redundant.
The company has not commented on the exact number of employees been affected by the transition. Though Ola has claimed that most of the employees have been absorbed within the Ola business, there are a few roles that ceased to exist after the transition. The company claims to be helping those employees offering enhanced severance benefits and outplacement services to pursue new career opportunities.
All this comes as an effort to reduce burn rate of operations of Ola in order to sustain the tough competition being given from Uber, which is the world's most valued start-up.
Source:
Business Standard 
Sad. Feel terrible for those 700 employees.
Sharing an incredibly well-written article by an incredibly talented writer - Ashish Mishra.
Behind TaxiForSure's Sellout Quote:
Over the previous 18 hours, Raghu, as he is popularly known, had practiced the speech, playing the sentences over and over again in his head. He would start by saying that in the three-and-a-half year journey of TaxiForSure (TFS), he had never thought that a day like this would ever come. That he had never planned for this. That it was the worst moment of his entire TFS journey.
Now that the moment had arrived, at around 2.30pm on a warm March afternoon, at TFS’s office in Bengaluru’s Koramangala, on the terrace, in front of almost 200 nervous employees, Raghu was overcome by emotion.
He gave himself a few seconds to recover. And then a few more.
The previous 18 hours had been tough. He had barely slept, knowing what was around the corner. Monday had started way earlier than usual. He woke up at 5am but there wasn’t much to do, so he idled around and, then, when his two-and-a-half-year-old son woke up, he made him breakfast. At about 7.30am, Raghu and his wife, Shilpa, left home. Their destination was TFS’s first office—the company had started here in 2011 with just two people—Raghu, 33, and Aprameya Radhakrishna, 34. It was a 100 sq. ft terrace office; No. 855, 4th Floor, 7th Main, JP Nagar, Bengaluru-78.
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This is very sad for the laid off employees. I hope they're scooped up quickly by other startup firms!
From a business point of view, TaxiForSure's exit was always on the cards after Ola took over TFS. It was only a matter of when rather than if.
TaxiForSure was not a major player in Chennai, and I found the availability of their cabs to get progressively lower with time (from the Ola app). It was quite evident that Ola was planning to shut down TFS by steadily migrating driver partners to their own service.
Quote:
Originally Posted by GTO
(Post 4036904)
Sad. Feel terrible for those 700 employees.
Sharing an incredibly well-written article by an incredibly talented writer - Ashish Mishra. Behind TaxiForSure's Sellout
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Sad story. I used Taxi For Sure in Bengaluru many time and I liked it very much. And i liked the jingle "sixty sixty ten ten" played every time in PVR cinemas quite catchy and for once I felt ads worked.
Quote:
Originally Posted by dZired
(Post 4036799)
Ola has officially shut down operations of its TaxiForSure (TFS) business.
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It had to happen - it's not the first and certainly won't be the last. Only reason it's making news is because of the purchase price of $200mn.
Check out
THIS article which talks about more such incidents.
Quote:
Originally Posted by avdhesh15
(Post 4037055)
Check out THIS article which talks about more such incidents.
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Interesting. This particular paragraph stands out. Why fight a competitor when you can kill him with some VC funds?
Quote:
Ola’s decision to buy (and now shut TFS) is regarded as a masterstroke by analysts and investors. By buying TFS (mostly in stock), Ola got rid of an annoying rival and became the only new-age Indian cab-hailing company investors could put money in. TFS also helped Ola extend its lead over Uber and focus all its energies on fending off its American rival rather than fighting on two fronts. Within six months of the TFS deal, Ola’s valuation soared more than five times to $5 billion when it raised $500 million from SoftBank, Tiger Global Management, DST Global and others.
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Acquiring a company, cherry picking and then killing it isn't new.
It's usual growth strategy.
This one's news because it's more visible.
Most don't even make it to newsrooms.
At the time of TFS sale, everyone in the know was aware TFS ran out of money and it was going to be dead any minute. TFS was a really dumb company without any serious technical/operational assets. VCs did some backroom dealings to facilitate the sale primarily to help fellow VCs. The sale had no material impact on Ola as a company. Indian VCs do lot of these 'you scratch my back, I will scratch yours' M&A.
Quote:
Originally Posted by androdev
(Post 4038765)
At the time of TFS sale, everyone in the know was aware TFS ran out of money and it was going to be dead any minute. TFS was a really dumb company without any serious technical/operational assets. VCs did some backroom dealings to facilitate the sale primarily to help fellow VCs. The sale had no material impact on Ola as a company. Indian VCs do lot of these 'you scratch my back, I will scratch yours' M&A.
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Well said.
And the TFS founder made big bucks and now goes about "advising" and "giving gyaan" to other humbler folks...bah!:)
The VC's are single handedly guilty in creating their own frankensteins by way of mad investments in all sorts of half baked hare brained things and the general behaviour of these young engineers and MBA's who run about like headless chickens also is hare brained because all of them want to hit the top by way of "valuation" without really working too hard or smart.
A 'startup" worth its salt, needs to have a clear idea on what it is offering and a view to its revenue stream and profitability. The old dicta and discipline of the "brick and mortar" has to be applied as with the science of normal common sense business!
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