Uber Technologies Inc., the mobile-app car service startup, is seeking “hundreds of millions” of dollars in a new financing round to fund its expansion to cities in China and around the world.
“There are discussions under way, we’re raising right now,” Chief Executive Officer Travis Kalanick said in an interview in Taipei yesterday after introducing Uber in the Asian city. He declined to identify potential investors or comment on the company’s valuation.
Private-equity firm TPG Capital LLP and Google Inc.’s Google Ventures are discussing an investment in the startup that would value the company at more than $3 billion, Fortune reported last week. Founded by Kalanick and Garrett Camp in 2009, San Francisco-based Uber connects drivers of vehicles with passengers via mobile applications on smartphones.
“Companies that are meeting aggressive growth targets are able to raise money faster than the average company,” Kalanick said. “There’s a huge opportunity for Uber to go to a lot of cities around the world, and I want to make sure we’re properly funded to do that and to do that as fast as we can.”
The startup has grown seven times its size over the past year, or an average compounded 18 percent increase in revenue each month for the past year, Kalanick said. Asian cities will be a focus for the next 12 months, where the low cost of labor in certain areas could make using Uber’s service cheaper than owning a car. Uber will debut in Seoul, its 38th city, on July 31.
Inconsistent enforcement of regulations, the diversity of cultures and regulatory structures in Asian cities are the main challenges to Uber’s expansion in the region, Kalanick said. The company had to navigate a South Korean law that limousine services cater only to non-citizens, he said.
Uber is no stranger to regulatory hurdles. While New York state now allows taxi riders to hail a cab using a smartphone application, Paris is weighing a potential rule requiring a longer wait for passengers ordering rides via mobile apps.
“I’m a tech guy, not a politics guy,” said Kalanick. “It’s part of what we have to deal with. That doesn’t mean we’re good at it.”
After Singapore, Taipei and Seoul, Uber’s next Asian city may be in China, the world’s second-biggest economy, where it hasn’t yet approached regulators.
“It would really suck to not be able to bring our innovation into China,” Kalanick said. “We’d love to be there.”