The French ridesharing startup BlaBlaCar announced last night that it had raised $200m (£129m) from investors in a funding round that valued the company at $1.6bn. The investment was led by Alibaba backers Insight Venture Partners and Lead Edge Capital, and is a big vote of confidence in the burgeoning ‘sharing economy’.
BlaBlaCar connects passengers in 19 countries, including the UK, with drivers looking to save money on the cost of a long journey. That can save a lot of cash compared to travelling by train – a trip from London to Edinburgh could set you back just £22, compared with as much as £140 via Virgin Trains East Coast.
‘It has been exhilarating to see our vision resonate with so many people globally, as BlaBlaCar’s community has rapidly scaled and flourished in every new market,’ said its CEO and co-founder Frédéric Mazzella. ‘We’ve built a unique activity based on the values of true sharing, and this funding will help unleash even more of its potential over the coming years.’
The news confirmed previous reports that it was Europe’s latest ‘unicorn’ – a startup valued at more than $1bn. Unicorns are so named for their rarity, and they’re all the more hard to come by in France. A recent report by the British investment firm GP Bullhound named just two other French start-ups – adtech firm Criteo and ecommerce company Vente Privee – as unicorns, compared with 17 that were based in the UK (and many more in the US).
It doesn’t help that a lot of French entrepreneurs have departed for more business-friendly climes. There are thought to be as many as a quarter of a million French people living in London and 60,000 in California. It’s little wonder that many ambitious techies don’t feel France is the best place for them to do business. Its reaction to Uber makes London’s black cabbies look welcoming, while its relationships with giants like Amazon and Google have been less than amicable.
There are signs of progress though. In 2013 its president Francois Hollande reformed capital gains tax so that business owners could make more money on the sale of a company, and also introduced a new entrepreneur visa to attract foreign investors. In May a number of French entrepreneurs, including Mazzella, launched #REVIENSLEON (‘Come Back, Leon’), a campaign that aims to tempt expats to return to France and contribute to its start-up ‘ecosystem’.
It will be a while before the effects of these changes (if there are any) are felt, though. For now, BlaBlaCar is part of a particularly exclusive club.