Supersized Startup Valuations: Is Uber Worth $10B?

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May 16 (Bloomberg) –- Michael Jaconi, co-founder and CEO of Button, Jing Herman, CEO of Gett USA, Gabe Klein, senior fellow at the Urban Land Institute, and Bloomberg's Cory Johnson discuss the valuation of Uber. They speak with Alix Steel on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

While ago.

What was so appealing about it that made you want to invest?

It was different from any of the other social media sites that we looked at.

It was really about the future and people's dreams.

You look at facebook, it is about the past and friends.

You look at twitter, it is about celebrities and what is happening now.

And interest is about inspiration, about finding that thing that you dream about.

Whether it is vacation or a new recipe.

We were able to contract -- convert on traffic leaving the site.

That was a soluble that.

You have $41 million in funding.

Do you feel that some of these valuations are getting too high?

I think to us valuation should reflect performance.

We have taken a much smaller amount of money, and been able to achieve awesome ability.

Globally we are the second player to uber.

We are at 100 million in volume, and we are growing 400% a year.

We are expecting to be .5 billion at the end of the year.

We are focusing on amazing products, delivering seamless service, and affect performance.

You are less leverage than they company like uber.

What is the danger in becoming too big?

There is some danger.

But the reality is that there are macro trends that people are not considering when they look at the valuation of $10 million for uber.

The trend is changing toward people moving back to cities.

They are moving back and tremendous numbers.

Here in washington dc we are getting 1100 new residents a month, and they are not bringing cars with them.

This is a great thing for all of the new transportation options out there.

We look at a platform like uber, and i will be honest that when it came out i was skeptical.

What i have learned is that this is a platform for many types of transportation, justice amazon started out as a bookseller.

Look at them now.

There are risks of taking too much money too soon, but i think in this case they want to grab as much market share as possible.

How do you tell the difference between a company that means the money to grow and one that is overleveraged?

That is a great question.

If you step too far away from this you can see amazing companies get valuations of billions of dollars.

When he gets closer to it what you see are companies that have two characteristics.

Those are the potential for profits and a great team, or you see really rapid revenue growth like we are seeing from air b&b and others.

The underlying thing which gave was alluding to is that the technology, as that of balls right now in the world of business in our society is not just changing other technologies it is changing other businesses.

This is the only panel we have ever had where you have two icings cabdrivers -- licensed cabdrivers.

This is not an area that technology would have touched in 1999. we have all of the latest in cutting-edge theyings.

We see that throughout the economy right now were technology is having a dramatic impact and revolution on the business and creating businesses like uber that were not popular before.

We are just more comfortable with e-commerce.

I am more comfortable buying stuff with my phone even five years ago.

I think a couple of things are happening.

Consumers now are carrying a supercomputer in the pocket every single day.

They are spending hours on end through social media and playing games, and transact in.

And the justification for the value is they have revenue growth.

They're showing in every single financing this tremendous ability to continue to exceed their expectations.

You saw very data that they were outpacing expectations significantly.

When you look at $10 billion and said that is a big number, i think you start to see what travis has alluded to as part of the strategy for getting theire.

I think the strategy is going to take them into new markets.

They have a digital maesh they're putting over cities, and that is what i think works.

How hard is it to compete with uber?

It is definitely a challenge, but it is a crowded space that are excited toing to be in.

Is a different client?

Isn't the way to differentiate yourself ? the difference is that we bring in swap pricing.

You can pre-book a ride and us which you cannot do with uber.

To define the barrier to be high or lower for entry?

He took one of our cars and it had an oxygen bar.

We recently announced a relationship where you can get anything in your car at any time.

It seems like the pink elephant in the room here is regulations.

This regulation have the possibility of squashing these companies?

I do not think so.

And i was on that side of the coin until recently in chicago and washington dc . once pandora's box was opened, i do not think you can stop these type of sharing services.

The reason they are trying to grab some lu much market right now, with the changes we will see over the coming 20 years that will take relation on the part of government, it is going to open up the entire market with taxi, right here, -- rideshare, it will become one thing over the next tech it.

There is a huge opportunity to own that market.

Today, monkeys?

That is the question.

We appreciate your input.

Coming up next, a town with an

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