Uber Technologies Inc. has closed a new round of funding valuing
the five-year-old ride-hailing company at close to $51 billion,
according to people familiar with the matter, equaling Facebook
Inc.'s record for a private venture-backed startup.
Uber raised close to $1 billion in the round, one of the people
said, bringing its total funding to more than $5 billion. The San
Francisco company initially had briefed investors on a plan to
raise between $1.5 billion and $2 billion, The Wall Street Journal
reported in May.
Investors in the latest round include Microsoft Corp. and the
investment arm of Indian media conglomerate Bennett Coleman &
Co., another person familiar with the matter said, as Uber seeks
allies to help bolster its technology and expand in large markets
outside the U.S.
Microsoft declined to comment. A Bennett Coleman executive
didn't immediately respond to a request for comment.
Uber's valuation has now reached the high-water mark set by
Facebook in 2011, when Goldman Sachs offered wealthy clients
outside the U.S. shares of the social network that implied a $50
billion valuation, not including the money raised.
At the time, Facebook was nearly seven years old. Uber just
turned five.
Uber's faster rise to $50 billion reflects its aggressive global
expansion into more than 300 cities and growing popularity ferrying
millions of riders daily.
In addition, Chief Executive Travis Kalanick has proved one of
Silicon Valley's most adept fundraisers. Uber's investors include
Qatar's sovereign-wealth fund; multiple hedge funds; Amazon.com
Inc. founder Jeff Bezos; and the venture arm of Google Inc.
Not all those deals have gone smoothly. Google invested more
than $250 million in 2013 and has helped Uber add new users by
promoting ride-sharing in its popular mobile maps. But friction has
emerged between the two companies in recent months as Uber has
taken steps to compete with Google in self-driving cars
Uber's latest financing vaults it past Chinese smartphone maker
Xiaomi Corp. as the world's most highly valued private startup.
Xiaomi attained a $46 billion valuation last December.
Microsoft is one of a handful of large software companies with
experience in online maps, an area where Uber has looked to develop
its own capabilities. In a deal announced in June, Uber acquired
assets related to street imaging and 3-D views used by Microsoft's
Bing Maps service and offered jobs to roughly 100 of its
workers.
For its latest funding, Uber also sought out large media
conglomerates outside the U.S., in regions where the company is
trying to build grass roots support for its battles with
traditional taxi operators and local regulators. Times Internet,
which runs investments and oversees websites for Bennett Coleman,
contributed to the new investment round after taking a stake in
Uber earlier this year as part of a marketing deal.
Separately, Uber said this week that it would invest $1 billion
in India in the next nine months. The company has faced regulatory
roadblocks in the country since December, when the app was banned
after a woman said she was raped by an Uber driver. The driver
denies wrongdoing and is currently on trial.
Last year, Uber said it raised $600 million from Baidu Inc.,
China's leading search engine. That alliance has helped Uber
compete with homegrown Chinese rival Didi Kauidi Joint Co., which
has the support of China's top two Internet companies, Alibaba
Holding Group Ltd. and Tencent Holding Ltd.
Uber also has held talks with investors to raise funds for
UberChina, a separate unit of the business funded by local
investors. That round could be closed as soon as next week, the
person familiar with the situation said.
Uber hasn't publicly discussed plans for an initial public
offering, but it has sold convertible debt to investors whose value
is tied in part to a future IPO price. Uber also negotiated a $2
billion credit line with a group of big banks, a move often made by
companies planning to go public, the Journal has reported.
Write to Douglas MacMillan at douglas.macmillan@wsj.com and
Telis Demos at telis.demos@wsj.com
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