Uber has enough money, right? No, never.
LetterOne, a Luxembourg-based private equity and venture capital firm headed by Mikhail Fridman, today announced that it has invested $200 million in Uber.
The press release put out by LetterOne confirming the new investment is a little vague on details, so I reached out to Uber to see if they can shed a little more light on how the company plans to use this new funding, but they’re declining to comment.
In any case, this new investment is a drop in the bucket for Uber, which raised $4.8 billion last year across several rounds led by Baidu, Goldman Sachs, Microsoft, and Indian media company Bennett, Coleman, and Company.
My guess is the new investment will support growing Uber operations in western Europe, though the company has not yet launched in Luxembourg itself. Generally, Uber’s massive fundraisings have been strategically aligned with its international growth efforts. So Baidu invested to help the ridesharing company fend off competition in China, and Bennett invested to help the company in India.
The smaller size of the investment (a step away from Uber’s typical $1 billion rounds) suggests that the company may be gearing up for a different kind of financial milestone: the initial public offering. Some predicted the company would file for IPO last year, though this year is looking more likely—if the growth and revenue numbers are there.
In the event of an IPO, Uber will also have to prove to shareholders that its striking, unionizing, and all-around rebelling workforce is not a big a threat to the company’s operations. Litigation is ongoing for the company in several markets across the world, including here at home in California.
Uber’s newest partner, LetterOne, invests in both energy and technology companies. Other tech companies backed by the firm include two telecommunications providers: Amsterdam-based VimpelCom, which offers the sixth largest mobile network in the world, and Istanbul-based Turkcell, the primary mobile phone operator in Turkey.
The firm also invests in energy "to build a new world-class, safe and sustainably growing global oil and gas company” (where "sustainably" is used in possibly the most ironic way possible) as well as in a portfolio of public and private equity, real estate, hedge funds, trading strategies, credit, and direct lending.
"We aim to invest in young but proven businesses,” said Alexey Reznikovich, LetterOnes’ technology-focused partner. “Our focus is on investing in exciting and innovative technologies. We don't want to focus on any specific sector - but on technologies - because they can jump from one sector to another. We take a long term view and have permanent capital.”
So if you’re a startup seeking funds from investors with permanent capital, there you go.