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Uber raising a new round at a $10B valuation?

The company is reportedly looking to raise capital for growth and operations

Financial trends and news by Faith Merino
May 16, 2014 | Comments
Short URL: http://vator.tv/n/36fe

It’s 2014—bring on the crazy tech valuations. On Thursday, Pinterest announced a new round of funding at a valuation of $5-freaking-billion, and now Uber is reportedly raising a new round at a $10 billion valuation.

The company is said to be raising less than $1 billion in funding from new private equity investors. The new round would triple its current $3.5 billion valuation. To date, Uber has raised $307.5 million from Benchmark, Google Ventures, TPG Growth, Jeff Bezos, Crunchfund, Goldman Sachs, First Round Capital, Lowercase Capital, and more. Last August, the company raised a $258 million round.

Uber could not be reached for comment (but my guess is, their response would be “no comment”).

While some other tech valuations might be full of hot air ($5 billion for a site that lets you clip and share pictures of food and home décor?), Uber’s valuation might actually be warranted. Last December, leaked internal reports showed that Uber is raking in a whopping $20 million a week. That adds up to more than $1 billion a year for the five-year-old company.

By comparison, Dropbox has a valuation of $10 billion but only generated $200 million in 2013. Fellow Silicon Valley darling, Airbnb, also recently raised a massive $450 million round at a $10 billion valuation, but the company reportedly only raked in $250 million in revenue last year (which is double its 2012 revenue, but it’s still hard to justify a $10 billion on $250 million in annual revenue). Meanwhile, HomeAway generated $346.5 million in 2013 but only has a market valuation of $4 billion.

And the leaked Uber numbers supposedly don’t even show the whole picture. While the company confirmed the numbers, they evidently don’t cover all of Uber’s business.

Last week, the company launched UberFAMILY, a premium service for customers traveling with young children. Only the “highest rated” drivers will be selected for the service and they will come with their own pre-installed child car seats. The service will come with an additional $10 premium charge, in addition to the usual fare. Over Mother’s Day weekend, the program was surcharge-free thanks to a partnership with Care.com.

The company is probably also raking in more money with its new $1 "don't get assaulted" surcharge on all UberX rides. 

Car-sharing service Lyft raised $250 million last month for a grand total of $332.5 million. It’s not clear where the company’s current valuation stands, but it’s probably pretty close to Uber’s current valuation of $3.5 billion. Participants in Lyft’s Series D round include Mayfield Fund, Founders Fund, Coatue Management, Andreessen Horowitz, Alibaba, and Third Point Ventures. 

 

Image source: suntimes.com


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