In an overwhelming indication of the rapid-fire pace of venture investments — and the ever-ballooning size of funding rounds — Uber reportedly has plans to raise between $1.5 billion and $2 billion in new funding.
The latest funding round, reported by the Wall Street Journal, would mark the fourth billion-dollar-plus financing for the on-demand ride-hailing app, which has spawned a new and exploding market for smartphone apps that connect passengers looking for a ride with contract drivers, and one that has eroded the taxi industry.
A round of that size would value the company at $50 billion or higher, people familiar with the funding plans told the Journal. That market cap would propel Uber to the highest-valued, VC-backed company in the world. Currently, Uber is ranked the second-most valued, with a $41 billion valuation. Another mega funding round would allow Uber to pass Xiamoi, the Chinese electronics behemoth headquartered in Beijing and currently valued at $46 billion, according to Dow Jones data.
Uber in February raised $1 billion to round out a $2.8 billion Series E, which it raised the lion s share of in 2014; that followed a $1.2 billion Series D that the San Francisco company also closed in 2014. The size of these funding rounds is unprecedented in tech venture financing, experts say, and now the pace at which Uber is raising these monstrous sums — at least twice a year — is also setting a private-market record. Most of Uber s funding is no longer coming from traditional venture firms but from large institutional investors, including hedge, mutual and pension funds.
The Wall Street Journal has previously reported that Uber last year had revenue of roughly $400 million, after accounting for how much it pays drivers. That means Uber may now worth more than 120 times its trailing revenue. . To compare, when Facebook raised money at a $50 billion valuation in early 2011, its prior-year revenue was $2 billion. And, Facebook was profitable at the time — which Uber is far from.
Photo: Foot traffic streams past Uber offices on Market Street in San Francisco, Calif, Monday evening, June 2, 2014. The urban tech boom is transforming much the long-blighted mid-Market area. By Karl Mondon/Bay Area News Group.
