110799

Uber raising funding at a $40 billion valuation?

The company is coming off a $1.2 billion round, and is now said to be raising yet another $1 billion

Financial trends and news by Steven Loeb
November 26, 2014 | Comments
Short URL: http://vator.tv/n/3aa6

Earlier this month, it was reported that Uber would be raising another $1 billion in funding at a possible $25 billion valuation. After the scandalous week that the company just had, though, some may have questioned how investors would react. After VP Emil Michael suggested that the company should devote $1 million to dig up dirt on the personal lives and families of journalists who say mean things about the company, would they balk at putting their money in?

Nope. Not at all. In fact, they are going full steam ahead.

Now a new report out from Bloomberg on Tuesday is painting that number even higher, putting it at between $35 and $40 billion instead. The round is said to include T. Rowe Price Group Inc, with existing investor Fidelity Investments also set to participate.

Such a huge valuation would double its current $17 billion value, which had already made it the highest-valued private company in Silicon Valley. It earned that number only four months ago, when it raised a record-breaking $1.2 billion back in June.

Prior to these mega-rounds, Uber had 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.

It's total funding raised now stands at roughly $1.5 billion.

There are three likely uses for the funding. First is expansion, which Uber has been pretty aggressive with lately, particularly in Asia. Last year it expanded to SingaporeSouth KoreaTaipeiDubaiShanghai andBangalore. In April of this year came the big one: the company began rolling out its services in Beijing.

It will also help Uber fend off competition from its biggest rivals, most notably Lyft. The two companies have recently been at each other's throats, with accusations of shady practices and the theft of internal documents. Uber has even suggested that Lyft investors have been pushing Uber to buy the company, something that Lyft has denied. 

The third, and most likely, answer for why Uber needed more money so quickly is for defending itself from regulators and local taxi services. The company has run into regulatory hurdles in virtually every city to which it’s expanded, and there has been a string of incidents that have called the service’s safety into question. 

In August the company hired David Plouffe, who was Barack Obama's campaign manager in 2008,  as its new Senior Vice President of Policy and Strategy.

Plouffe's job is to manage all global policy and political activities, communications, and Uber branding efforts. He is, essentially, supposed to build up Uber's brand in the same way he did for Obama, to get out ahead of the taxi industry, and to get both customer and regulators on Uber's side.

Another $1 billion would certainly help the company fend off more of these attacks.

Vator has reached out to Uber for comment on this report. We will update if we learn more. 

(Image source: macworld.com)


Related companies, investors and entrepreneurs

13999
Uber
Startup/Business
Description: Uber is a ridesharing service headquartered in San Francisco, United States, which operates in multiple international cities. The company...

Related news


blog comments powered by Disqus