Uber’s value more than doubles to $40bn after investors back fundraising

Uber Spoitfy app

Uber, the taxi service that allows users to hail a ride using their smartphone, has been valued at more than $40bn (£25.5bn) after its latest funding round.

The total is more than double the $18.2bn the company was said to be worth in June, when it raised $1.2bn from investors including Fidelity Investments and BlackRock.

Uber did not reveal who had put a further $1.2bn in the business. It already counts Goldman Sachs and Google Ventures as investors.

The latest valuation make the business worth more than listed companies such as the airline Delta ($37.4bn) and Kraft Foods ($35.4bn).

Only Facebook was valued higher as a private company – $50bn – by investors when it raised money ahead of floating on Nasdaq. The social network is now valued at almost $210bn.

Uber is not expected to become a public company for at least another 12 months.

Travis Kalanick, its co-founder and chief executive, said the new funding would allow the company to expand, particularly in the Asia-Pacific region.

He said in a blog post that Uber is now six times larger than it was 12 months ago, operating in more than 250 cities in 50 countries.

However, Kalanick admitted that the pace of expansion experienced by the company had resulted in “significant growing pains”.

He added: “The events of the recent weeks have shown us that we also need to invest in internal growth and change. Acknowledging mistakes and learning from them are the first steps.”

Uber has had to fight fires on a number of fronts this year, including negative stories about its corporate culture and the alleged behaviour of some of its drivers. One driver was charged in San Francisco with assaulting a customer in June.

It has also had to deal with attempts to limit its operations in a number of cities.

Last month the company apologised after a senior executive suggested the company hire a team of researchers to dig up dirt on hostile journalists.

The apology came in the same week that Al Franken, the television comedian turned Democrat senator and chairman of the Senate sub-committee on privacy, wrote to Kalanick asking Uber to explain how it dealt with users’ data.

Its employees are able to track customers because its smartphone app relies on GPS technology to connect users with drivers.

“The reports suggest a troubling disregard for customers’ privacy, including the need to protect their sensitive geolocation data,” Franken wrote. “Under what circumstances would an employee face discipline for a violation of Uber’s privacy policies?”

He gave Uber 28 days to respond to his questions. The company said it would do so and had instructed law firm Hogan Lovells to review its data privacy rules.

The San Francisco-based firm also said on Thursday that it had set up a software development team in Amsterdam, its international headquarters.

Conrad Whelan, Uber’s second employee and first engineer, said he had begun working with a team of 10 Dutch mobile software experts and hoped to expand that number to as many as 40 in the coming year.

US technology companies routinely complain about the difficulty of obtaining visas for foreign software engineers. Uber also faces competition from Silicon Valley giants such as Google and Facebook for talent.

Powered by Guardian.co.ukThis article was written by Chris Johnston, for The Guardian on Friday 5th December 2014 00.33 Europe/London

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