Uber is raising funding that could value it at $17bn to bury rival Lyft

The taxi-challenger is reportedly running scared of the lift-sharing service, despite its eye-watering valuation.

by Rachel Savage
Last Updated: 13 Aug 2014

You’d think reportedly raising enough cash to value your barely-out-of-the-stroller startup at $17bn (£10.2bn) would allow a chief exec to take a moment out to survey their nascent empire. Not so for Uber boss Travis Kalanick, who is apparently ramping up his fundraising efforts to literally spend rival Lyft into submission.

Last August, Uber, whose private hire cars have been irking taxi drivers all over the world, raised $250m, bringing its total funding to more than $300m. Then, at the start of April, car-sharing service Lyft announced it was raising $250m, which would also bring its total backing to more than $300m.

A month later, news broke that Uber was looking to bring in somewhere under $1bn, valuing it at $10bn, a similarly massive valuation to recent funding rounds by room rental platform Airbnb and file sharing service Dropbox.

But wait - another month down the line, reports are doing the rounds that private equity investors are so keen to get a slice of the taxi-challenger pie that Uber could be valued at an even more eye-watering $17bn (although there is still no word on whether that equates to more stock being sold or just a stratospheric increase in valuation). Anything you can do we can do better...

Kalanick hasn’t made any secret of his desire to outspend Lyft either. ‘We do 10 times more trips than them and on a booking basis we're 20 times bigger,’ he said on stage at a conference last week. ‘If they have the same amount of funding, we spend faster, so you have to make sure you have a cash advantage.’

However, even attracting stupid amounts of dollar can’t inure Uber, which reportedly facilitated more than $1bn of taxi rides in 2013, from inevitable growing pains. TfL has referred it to the High Court, after London’s black cabbies claimed using GPS to calculate fares is breaking a law that says only taxis can have meters.

Meanwhile, in LA an Uber driver has been arrested for allegedly sexually assaulting a passenger (although he reportedly wasn’t connected to Uber’s system at the time). Facing down fellow upstarts as he takes on the coddled establishment certainly isn’t Kalanick’s only problem.

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