Not long ago, Bhavish Aggarwal was India’s entrepreneurial darling—a bold founder promising to lead the country’s EV revolution. Backed by SoftBank and other marquee investors, Ola Electric Mobility Ltd. rode a wave of optimism as it promised to flood Indian roads with electric scooters and eventually roll out a homegrown electric car. But one year after its blockbuster IPO, Ola is now navigating a full-blown crisis. Scooters catching fire, customers lamenting breakdowns, and an ambitious electric car that never saw the light of day—these are just some of the symptoms of a deeper malaise: trying to scale too fast without getting the fundamentals right.
Once hailed as India’s Tesla, Ola’s fortunes have plummeted dramatically. Its stock has plunged over 48% in 2025, making it one of the worst-performing company on India’s BSE 500 and NIFTY Midcap 100 indices. At the center of the storm is Aggarwal, whose bold bets and high-speed scaling are now being re-evaluated as hubris.
The Cost of Moving Too Fast
Ola’s troubles started when it rushed the AppScooter, acquired from the Dutch firm Etergo, into production without tailoring it for Indian roads. Re-engineered for higher speeds and loaded with a heavier battery, the vehicle wasn’t designed to withstand India’s harsh climate or infrastructure. The result: breakdowns, fires, and a torrent of negative publicity. Quality issues peaked with the S1 Air model in 2023, with panel gaps, loose headlights, and design flaws that required quick fixes on the shop floor, often literally.
Instead of taking a step back to reassess, Ola doubled down. Second-generation scooters arrived just as quickly, using cheaper components like hub motors prone to water damage. During the monsoon season, complaints poured in, highlighting how innovation can falter without adequate testing and localization.
Investor Fatigue and a Shrinking Market Share
SoftBank, Matrix Partners, and Tiger Global—once enthusiastic backers—are quietly trimming their stakes. Hyundai and Kia dumped 136 million shares in June, signalling waning institutional confidence. Meanwhile, Ola’s market share has fallen from 46% to under 20% in just a year, and the company posted a staggering 22.5 billion rupees in losses for the year ended March 31, 2025.
Aggarwal is now in firefighting mode. A rumoured loan hunt is underway, and he’s had to personally inject Rs. 20 crore in cash to maintain collateral on his pledged shares. Internally, the company has seen sweeping layoffs, missed bonus payouts, and delayed vendor payments. Departments like product planning have vanished entirely.
The latest blow: the Roadster X electric motorcycle, launched with great fanfare, is already drawing customer complaints, especially about charging issues that service centers reportedly couldn’t resolve.
A Broader Reckoning in India’s Startup Ecosystem
Ola’s unravelling is not an isolated event. India’s startup ecosystem, once flush with capital, is facing a sobering reset. Byju’s, PharmEasy, and Oyo—once poster children of the funding boom—are grappling with crises ranging from legal troubles to layoffs and valuation crashes. Investors are now scrutinizing fundamentals over flashy growth projections. As one venture capitalist put it: “Too much capital before product-market fit can do more harm than good.” Recent debates around Kunal Shah’s Cred are a reminder of the fragility of pursuing valuations and scale over profitability.
What makes Ola’s fall especially poignant is the scale of its ambition. Aggarwal’s vision was never small. He promised not just vehicles, but a revolution. He built a factory in India’s south, opened an R&D center in the UK’s automotive heartland, and styled himself after Elon Musk. But unlike Tesla, Ola never got the engineering cadence right. Its early entry into the market was its biggest strength—and its greatest weakness.
The Road Ahead: Time to Rebuild, Not Race
There is still a path forward for Ola, but it won’t be easy. The company must slow down and rebuild consumer trust with dependable, thoroughly tested products. It needs to honour vendor relationships, pay its people fairly, and invest in after-sales service, which is crucial for long-term brand equity in India.
Aggarwal’s pivot to artificial intelligence with Krutrim—a unicorn valued at $1 billion in 2024—suggests he’s still dreaming big. But Ola Electric, the venture that first made him a household name, cannot be salvaged by ambition alone. Execution, humility, and resilience must take center stage now.
Ola’s story is not just about scooters, stocks, or startups. It’s about what happens when vision isn’t tempered by patience. India deserves EV champions—but it also deserves products that don’t catch fire.
