Early this morning, Dubai-based ride-hailing app Careem announced that it has raised $200 million. As a reminder, last month rumors swirled in the tech world that the company was entertaining the idea of being acquired by Uber. But $200 million from investors, including Kingdom Holding Company (the investment vehicle of Saudi Prince Alwaleed bin Talal), says that might not be the case.
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Careem closed its $500 million round from Kingdom Holding Company, German automotive company Daimler, and other investors back in June 2017. The company has since expanded into other geographical areas in the Middle East and North Africa and is planning to launch a food delivery service. It has now raised a total of $771.7 million, per Crunchbase, and is reportedly valued at over $2 billion.
This news comes as Uber has its eyes set on a potential IPO early next year that could value the company at $120 billion. Of course, the company hasn’t done the best job of competing in Asian markets where local companies have invaluable regional knowledge and a voracious appetite for success. It backed out of China, losing to Didi Chuxing, in 2016, and left Southeast Asia earlier this year, selling its regional operations to Singapore-based Grab.
In any case, with a potential valuation of an estimated 11 times its revenue multiple and with Careem’s war chest topped off by investors, maybe leaving the Middle East and continuing to focus on markets where it burns less cash is a good option for Uber.
Illustration Credit: Li Anne Dias