Ola's IP Transfer: Bhavish Aggarwal's Financial Jugglery

The post will dissect the financial practices around Ola Cabs, Ola Electric, and Krutrim, focusing on related party transactions, governance gaps, and investor complacency, with key lessons for startup founders and investors alike.

Growth is essential, but not at the cost of integrity, transparency, or accountability. Startups don’t get a free pass just because they operate in emerging markets or disruptive sectors. That’s why what’s unfolding at Ola, and its offshoots Ola Electric and Krutrim. This is a cautionary tale for founders, investors, and boardrooms across the globe.

Let’s dive into the story.

Part I: A Tale of Two Startups (and Bhavish Aggarwal)

Ola Cabs, or Ola Consumer, as it’s now called, has raised nearly $5 billion over 15 years. US-based asset management giant Vanguard has significantly cut down the valuation of Indian mobility company Ola to $1.25 billion, as per its recent filing with SEC. This marks an 80+% plunge from Ola's peak valuation of $7.3 Bn in 2021. More value has been burned than built, and that alone would be reason for concern. But, that’s just the setup.

In 2017, Ola spun off Ola Electric, a venture into electric two-wheelers. On paper, it looked like a pivot. In practice, it was a lifeboat. Ola Electric launched using Ola Cabs’ infrastructure, its app, its bike fleet, its distribution.

This wasn’t just a shared service agreement, rather a full-blown related party transaction, with Ola Electric riding on the back of its parent company’s assets.

Yet none of that synergy, or dependency, showed up on Ola Electric’s cap table.

Not a single share was allocated to Ola Cabs’ investors. It’s as if the old company incubated the new one for free, and was then kicked to the curb.

This is not just financial mismanagement, it’s value expropriation.

Global heavyweights like SoftBank, Tiger Global, Temasek, and Matrix Partners had ringside seats. These are sophisticated institutions with deep due diligence processes. Yet, they greenlit this orchestration.

Part II: The Vanishing Stake, Silent Investors and Stakholders

Things got worse. Bhavish Aggarwal, Ola’s founder, didn’t just distance himself from Ola Cabs. He bypassed it, and its shareholders, entirely. Despite raising billions for Ola Cabs, he walked away, retained his title, drew a salary, and used the company's network to build Ola Electric, a separate entity in which he holds a controlling stake.

Even Ola Cabs’ co-founder Ankit Bhati was pushed out of the narrative. In simple terms, Ola Cabs, which acted as the incubator, would own a significant stake in Ola Electric. At minimum, existing investors like SoftBank, Tiger Global, Matrix Partners, and Temasek should have had rights or carry-over positions.

But none of them did, and shockingly they didn't protest. Which raises a rather troubling question:

Why didn’t the major VC and PE funds object? Were they unaware? Unconcerned? Or complicit in looking the other way for the sake of optics?

Part III: The IP Transfer That Raised Eyebrows

And, the plot thickens. Recent reports suggest that ANI Technologies (parent of Ola Cabs) is now transferring Ola’s brand IP to Bhavish Aggarwal’s personal family office. You heard it right, not to Ola Electric, not to a holding company, but to his private vehicle.

The brand built with investor dollars is now walking into the founder’s personal vault, a serious red flag in corporate governance. A move so brazen that it shocked even those used to founder dominance. Brand value of Ola, arguably the most durable asset in consumer businesses, is being offloaded in a related party transaction.

This has major implications for governance, future fundraising, and any IPO ambitions.

Expectedly, the investors stayed mostly silent, registering mere "unhappiness."

Part IV: Enter Krutrim, The AI Vanity Project

That’s not all. Bhavish Aggarwal recently launched Krutrim, an AI venture. Somehow, he convinced Matrix Partners to come back for more, this time, with $50 million in seed money at a $1 billion valuation. The rest, a whopping $230 million, was positioned as Aggarwal’s “personal investment.”

Raising the obvious question: Where did he get the money?

After all Aggarwal doesn't have $230 million in liquidity. Well, he pledged 8% of his Ola Electric stake, which might account for $72 million at best, that leaves $160 million unaccounted for.

Is it convertible debt, roundabout financing, or founder fantasy, nobody has answers.

It’s the kind of opacity that should alarm the investors, not clapping.

Even respected AI leaders in India have criticized Krutrim as a "repackaged product" with no original technology. Yet the valuation games continue, and the same playbook, inflate early, consolidate control, stay vague on cap tables, is in full swing.

Conclusion: The Cost of Looking Away

What’s happening with Ola, Ola Electric, and Krutrim is not a story of innovation. It’s a story of unchecked founder power, questionable financial engineering, and investor silence.

And it’s a classic case study of what not to do when building sustainable, scalable ventures.

The lessons are clear:

• Founders must remember they are stewards, not emperors. Every dollar raised is a fiduciary obligation, not a personal license.

• Investors must enforce accountability. Giving leeway for vision is one thing, enabling abuse of structure is another.

• Regulators should take note. Related party transactions that lack transparency or fair valuation corrode trust in the entire startup ecosystem.

• And aspiring entrepreneurs should understand that integrity, not hype, is the ultimate moat.

Financial jugglery may get you to the next round. But it rarely gets you to the last.