Sun, Jun 08, 2014 - Page 13 News List

Taxi app Uber valued at US$17bn


Taxi app Uber shifted into the elite ranks of Silicon Valley on Friday with a round of funding that gives the California-based startup a US$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, the company said.

Uber said the latest funding round would result in about US$1.4 billion being raised and give the company a value of US$17 billion.

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

Uber offers smartphone applications letting passengers connect with taxis along with a “black car” service and 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. For example, in New York 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 meet standards 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 (DMV) in Virginia.

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

“Uber will operate as usual and we plan to continue full-speed ahead with our commitment to providing Virginians access to safe, affordable and reliable rides.”

Worries prompted by Uber and other ride-share services include how to vet drivers and whom to hold responsible in accidents.

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