Moving up: Taxi app valued at $17 billion

Highest-ever valuation for a tech start-up.

SAN FRANCISCO:

Internet Age taxi app Uber up shifted to the elite ranks of Silicon Valley on Friday with a round of funding that gives the California-based startup a whopping $17 billion value.

“With our growth and expansion, the company has evolved from being a scrappy Silicon Valley tech startup to being a way of life for millions of people in cities around the world,” Uber said in a blog post.

The startup maintained that its mission is to “enable a transportation alternative in cities that makes car ownership a thing of the past.”

Since launching in San Francisco four years ago, Uber has spread to 128 cities in 37 countries, according to the company.

Uber said the latest funding round will result in about $1.4 billion being raised, giving the company a value of $17 billion.

The stunning valuation is one of the highest ever for a technology startup, trumping home-sharing app Airbnb and the largest for a venture-backed group since social networking star Facebook.

Uber, launched in 2009, offers smartphone applications letting passengers connect with taxis along with a “black car” service.

Uber is the most prominent of the apps that are shaking up the traditional taxi landscape in cities around the world, having launched in cities from Beijing to Berlin to Bogota.

The company has faced significant resistance from regulators. In New York, for example, Uber’s rates run afoul of fares set by the city’s taxi commission.

Uber has also faced regulatory issues in Europe and protests from taxi operators who claim the service is unfair competition and fails to live up to standards set for such services.

Ride-sharing apps for smartphones are part of a “collective consumption” trend in which people use mobile devices and social networks to find vacation lodging; rides around town, and more. Such services threaten to disrupt traditional ways of doing business and pit fans against critics.

This week Colorado became the first US state to pass a law aimed at reining in the business of ride-sharing, where Uber and Lyft are front and center.

The law empowers a state commission to balance “openness to new business modalities with the need for limited safeguards” when it comes to ride-sharing.

Uber this week also received a cease-and-desist letter from the state department of motor vehicles in Virginia.

“We are surprised and disappointed by the DMV’s actions,” Uber said Friday in a blog post that noted it has been working with Virginia for months to modernise regulations.

Uber is known for operating like a taxi service, except people summon and pay for transportation using smartphone applications.

Published in The Express Tribune, June 8^th, 2014.

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