For years, Uber and Ola dominated India’s cab-hailing market, competing fiercely to win over riders. Then came Rapido, a smaller company with a bold vision. By introducing bike taxis, Rapido disrupted the market, turning the two-way rivalry into a three-way competition.
Rapido’s Journey: From Startup to Disruptor
Founded in 2015, Rapido entered a market ruled by giants—Ola, valued at $5 billion, and Uber, a global powerhouse worth $60 billion. Instead of challenging them head-on in the car segment, Rapido focused on bike taxis, a niche service largely overlooked.
With just $2 million in its early years, Rapido built a scalable model. By 2024, it had grown significantly:
- Bike taxis: 56% market share.
- Three-wheelers: 33% market share.
- Cars: A growing presence, capturing 14–18% of the market.
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Smart Fundraising and Growth
Rapido’s success relied on both innovation and strategic fundraising. By 2022, the company was valued at $830 million, backed by investors like Swiggy and Nexus Venture Partners. Despite tough conditions for startups in 2024, Rapido raised $200 million, entering the unicorn club with a valuation of $1.07 billion.
Although this was a significant milestone, the relatively small increase in valuation reflected the challenges of competing in a low-margin business dominated by Uber and Ola.
Game-Changing Subscription Model
Rapido revolutionized driver earnings with its subscription model. Unlike Uber and Ola, which charged drivers commissions of up to 30%, Rapido offered a fixed subscription fee. This approach benefited everyone:
- Drivers earned more by keeping a larger share of their income.
- Riders enjoyed fares that were 10–15% cheaper.
While Namma Yatri, a local platform, introduced the subscription model for three-wheelers, Rapido scaled it across bikes, three-wheelers, and cars. This forced Ola to adopt similar strategies in certain segments after losing market share.
Rapido’s Rapid Rise
Rapido has reshaped the cab-hailing market with impressive numbers:
- Monthly Active Users (MAUs): Rapido has 31.8 million, closing in on Uber’s 33.6 million and surpassing Ola’s 28.6 million.
- App Downloads (2024): Rapido recorded 33 million downloads, compared to Uber’s 17.7 million and Ola’s 17.3 million.
- Daily Cab Trips: Uber leads with 840,000, followed by Ola (460,000) and Rapido (320,000).
- Bike Taxis: Rapido dominates with a 61% market share.
Financially, Rapido is also gaining ground. In FY24, it grew its revenue by 46% to ₹648 crore while halving its losses to ₹370 crore. In the first quarter of FY25, it further reduced its losses to just ₹17 crore.
Ola’s Decline
Once a market leader, Ola is now struggling. Its daily trips have decreased, and its valuation has fallen sharply from $7.3 billion in 2021 to $2 billion in 2024.
Much of this decline stems from a lack of focus. Ola’s founder, Bhavish Aggarwal, has prioritized side projects like Ola Electric, leaving the core cab business neglected. Additionally, Ola’s hesitation to fully adopt the subscription model in the car segment has hurt its competitiveness.
Uber’s Resilience
Uber has maintained its position as a premium service, thanks to strategies like partnerships with Everest Fleet to ensure car availability. While Uber has adopted subscription models in other markets, tax concerns have limited its ability to do so in India. Instead, Uber relies on discounts to compete, especially in the autorickshaw segment.
However, with Rapido and platforms like Namma Yatri gaining ground, Uber faces increasing pressure.
What Lies Ahead?
The dominance of Uber and Ola in India’s cab-hailing market is over. Rapido has proven that innovation and persistence can disrupt even the strongest players.
As the market evolves, key questions remain:
- Will Rapido expand its subscription model further?
- Can Ola regain its footing?
- How will Uber respond to growing competition?
What’s certain is that India’s cab-hailing market is now more dynamic than ever, with Rapido leading the charge as a game-changing force.
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