Subscribe Intellectual Indies, press the bell icon and never miss an update Hello friends, my name is sahil khanna and you are watching intellectual indies and today we’ll talk about ola and uber business model. I know you already know about them What do they do? they have a taxi business Ola is our indian based startup and uber is international So i’ll talk about ola more and less in uber because we are indians And our audience is india centeric See if i want to start my taxi business Most important thing i need is taxi and a driver and from where do i get the money? If i invest money in buying taxi in the inital stage Ola says that they have around 5 lakh registered driver Now it means 5 lakh taxis , how did they do this investment? They came with a model that You need to have a driver and a car and we’ll give you commission and you need to give us some percentage of the revenue This seems interesting We get to know that on some rides If we drive 12 hours then this much money this much incentive. and can earn around 1 lakh. Drivers got fascinated by this and some who were wise CA people What did they do? they put their own cars and hired an employee On EMI EMi of around 10,000 and hired an employee in 20,000 and he’ll get 5000 incentive. and used to track their employees , this lead to a network of 10-15 cars and they earned thousands and lakhs from this Everything was going fine till now For drivers, this thing is good But ola uber give us discount coupons and first ride freea and 6rs/km Cheaper than auto How were they paying for this? Basically they were in loss. In the last financial year 2015, they beared the loss of 2300 crore. I’ll tell you in more details. About their profit and loss. Salaries amount was around 381 crore. and advertising cost 437crore and cost on tech was 120 crore. What about the other expenses? SO they tried to analyse this In this financial year, they increased the percentage of incentives. Now 5 lakh people are linked with them That EMI trap What happened here People who used to earn 1 lakh, now they earn 35000 32000 If they want to earn 1 lakh then they have to work for 24 hours. Which is not possible. What happened here, they hired their own drivers their own cabs. And they just need to give them commision and they’ll earn profit. In this financial year, we’ll get all the details of their profit and loss According to me Their loss margin has decreased In the initial stages People used to prefer auto than cabs And before auto ,people prefer auto Then metro came If you are getting a cab in 6rs and 3 people can easily seat in a cab Why wouldn’t people use cabs? Now when people are tilted towards cabs One thing Economies of scale THere was a person who used to take 10 rounds of driving 10 hours and now he has work of 16 hours, so here he can earn more So ola and uber Brought a revolution where they tried to let people switch from auto to cab So according to me This is a very profitable business model In starting they did bear the loss of 2300 crore. it’s a big loss and their valuation Decreased after they asked for funding. Why did it happen? because of the loss Now you’ll see it’s valuation will increase. Because it’s loss is less. Now let’s talk about some strategic decision Means they acquired some startup First they did in 2015 Taxiforsure Taxiforsure had a good marketing image They acquired them and people get to know about ola and uber. That was the time when ola and uber was highlighted in the eyes of people Because they bought taxiforsure and in the same year They bought the jio tag also Basically it’s computer system No. of km and total amount All the software system was designed by jio tag GPS tracking and everything So they are getting ROI from the money they invested in 2015 JIO spent 2 lakh crore On the spectrum but They’ll get the ROI from now>Okay friends, video ends here. I hope you liked it. If any doubts do ask me in the comments. and like, share and do tell me in the comments. What should be the topic of our next business model I am thinking OYO rooms I really like their business model. Because their way of earning is same as uber,ola Offering you discount and many things. Do tell me in the comments section About any topic you want me to cover Bye Goodnight Goodmorning Goodafternoon whenever you are watching this video.