Uber, the transportation and ride-sharing startup has raised another $1.2 billion in funding. The new round of funding valued it at $41 billion, a bet by some of the world’s top investors that the firm can sustain a breakneck global expansion pace despite fierce challenges from regulators and taxi companies.
The San Francisco-based company collected $1.2 billion that enables it to expand its workforce, lure new drivers, test a delivery service and subsidize prices in some of the 250 cities around the world where it operates. The closely held company has raised eight times as much as its closest ride-sharing rival, Lyft Inc.
The news comes at a key time for the company. While there have been numerous reports around for a while of Uber raising more money at around a $40 billion valuation, the startup has been under fire for a lot of its business practices both from regulators and other observers who have criticized the company’s ethics.
“International expansion probably is the key theme of the fundraising,” said Bill Gurley, a partner at Uber venture investor Benchmark and a member of the board at the ride-sharing company. “We feel remarkably good about where we stand in the domestic market and our real growth initiatives are focused internationally.”
The decision to use the funding to expand Uber in Asia might also be on the cards. The company needs capital to keep up with its aggressive pricing and marketing tactics, which it has been running in the region for months to build up its market share against incumbent players. Those rivals have been also capitalizing at a rapid pace. They include GrabTaxi yesterday announcing a $250 million raise, and India’s Ola raising $210 million — with Softbank participating in both of those rounds.
A year ago, Uber was in 60 cities and 21 countries. Today they are in over 250 cities in 50 countries.They are 6 times bigger today than 12 months ago with that growth accelerating.
Uber has now raised $2.7 billion in funding, with a very long list of investors that includes Menlo Ventures, Google Ventures, Kleiner Perkins Caufield & Byers, Summit Partners, BlackRock, Wellington Management, Benchmark, TPG Growth, Troy Carter, Jeff Bezos, CrunchFund, Goldman Sachs and a whole lot more.