Uber, the shared-car service, raised $1.2 billion in new funding, in a deal that sets the record for a valuation from a direct funding round.
The latest round was led by Fidelity Investments, which invested about $425 million. The round also featured $209 million from money manager Wellington Management and $175 million from investment firm BlackRock. The Wall Street Journal says four venture firms also participated: Summit Partners, Kleiner Perkins Caufield & Byers, Google Ventures, and Menlo Ventures.
That round gives Uber an uber-valuation, though it is unclear exactly what that value is. The Journal pegs it at $18.2 billion, while Bloomberg News says it is $17 billion.
Either way, there has never been a tech company with a value set that high through direct funding rounds. (Some private companies fetched higher valuations because of acquisitions or indirect funding.) As Anand Sanwal, CEO of research firm CB Insights, told Bloomberg: “It’s a testament to the traction and opportunity ahead of the company. Their vision is obviously much larger than just a taxi service.”
So how big is Uber now? At the low end of the valuation estimate, the company is worth more than better-known brands like Goodyear Tire (which keep the cars on the roads), AutoNation and CarMax (where the drivers buy their cars) and Progressive Insurance and Hartford Insurance (where they might be insured). What's more, Uber is larger in value than competitors Avis Budget Group and Hertz Global.
Uber is using the new money to continue to fuel its expansion. Right now, the company operates in 128 cities in 37 countries. In an interview with Bloomberg, Uber chief executive Travis Kalanick said the company would also continue to experiment “aggressively” with lowering prices.
Uber is also testing the waters of moving away from just the transportation of people and focusing on its ability to run a full-fledged logistics network to shepherd goods. In April, it started experimenting with a courier service for deliveries in New York City, with hints it could expand the service in other cities.