Uber China, the well-known on-request taxi app has announced it raising $1.2 billion in a funding round led by Baidu, the giant Chinese search engine along with other investors who have not been named. This funding round seems to be unfinished and it expected to receive additional investments in the near future. The current value of Uber China seems to be $7 billion pre-money valuation.
Operating in 11 cities in China already, the San Francisco-based company plans to expand it to 50 cities in a year’s time. Travis Kalanick, the CEO of the company stated, “This kind of growth is remarkable and unprecedented. To put it frankly, China represents one of the largest untapped opportunities for Uber, potentially larger than USA. Success in China, however, takes commitment over the long haul and a strong will, coupled with a unique understanding of the differences in China.”
To achieve the expansion, Uber plans to create local teams and partner with many local companies. The company’s partnership with Baidu would help the company with the mapping and payment services in China. “We can get introductions to the city governments, the government officials that want to shepherd our kind of innovation and our kind of progress into their cities,” said Kalanick.
Following the fund-raising of the Uber, reports suggest that Didi Kuaidi, another ride-hailing app and arch rival of Uber is set to raise around $3 billion through its latest fund-raising. The cash inflow increases the stake of top two valuable startups in China. However, it’s not very clear how the market is spit in China. Uber claims it has captured 50% of the market whereas Did Kuaidi claims to hold 60%. Now with more large funds raised from the rounds, both the company works to attract users by subsidising trips and introducing many offers.