Peter Delevett covers startups and venture capital for the San Jose Mercury News. He's been a journalist in Silicon Valley since the dot-com daze.
Good week, bad week for SideCar
SideCar, the San Francisco startup that’s part of a growing car-sharing movement, has found itself in the crosshairs of state regulators, with the California Public Utilities Commission trying to shut down the service and rivals Lyft and Zimrides. What better time, then, to jiu-jitsu the news cycle by announcing a hefty new funding round?
The $10 million haul, the company’s first institutional round after a seed infusion last year, comes courtesy of Google Ventures and Lightspeed Venture Partners. While nobody quoted in the announcement makes mention of the CPUC — which claims the car-sharing operations amount to unlicensed taxi companies — SideCar CEO Sunil Paul hasn’t been shrinking from the fight. He’s posted the cease-and-desist letter, and a snappy rejoinder, on the company’s blog. “This is not just about SideCar,” he writes. “This is about our right to share with one another.”
I asked Paul and Google Ventures whether any of the dough can be used for legal expenses, if it comes to that. A SideCar spokeswoman noted that according to the press release, “The funds will be used to grow the company’s operations, further develop technology and expand into new markets nationwide.”
Paul also has said his venture backers were aware of the cease-and-desist order and that he assured them he carefully built SideCar within existing laws. (Then again, if you’re in a standoff with the government, it never hurts to have Google on your side, as they’ve got some experience with that sort of thing.)
Peter Delevett covers startups and venture capital for the San Jose Mercury News. He's been a journalist in Silicon Valley since the dot-com daze.
