VC Deals: SoftBank Puts $940M In Self-Driving Bots

DoorDash (DOORD) is reportedly raising for a $500M round that would push its valuation to between $6B and $7B. Temasek is expected to lead the …

Welcome to Seeking Alpha’s Venture Capital Deals of the Week. Follow this account and turn on the e-mail alert to receive VCDeals in your inbox on Saturday mornings.

1. SoftBank bets $940M on autonomous delivery bots

SoftBank (OTCPK:SFTBF, OTCPK:SFTBY) Vision Fund invested $940M in autonomous vehicle startup Nuro at a $2.7B valuation.

Nuro was founded by two vets of Google’s self-driving project (now called Waymo) and last year launched an autonomous vehicle for grocery deliveries and other errands. Last year, Nuro and Kroger launched a pilot grocery delivery program in Arizona that uses a delivery bot without a safety driver. Nuro also licensed its tech to autonomous truck startup Ike.

The massive infusion will likely go towards expanding its delivery service, scaling up its fleet of self-driving bots, signing up new partners, and hiring.

2. Amazon makes another vehicle investment

Amazon (NASDAQ:AMZN) led a $700M equity round in electric truck startup Rivian. GM (NYSE:GM) was reportedly still circling a potential investment.

Rivian plans to launch its R1T pickup truck and R1S sport utility in the U.S. next year with a global launch following in 2021. The vehicles are modeled on a “skateboard” platform the company says has the flexibility to accommodate several different vehicle body styles. Amazon’s investment in Rivian came a week after the tech giant participated in a funding round for autonomous vehicle tech startup Aurora.

Competitors: Traditional truck and SUV automakers like GM and Ford (NYSE:F) plus Tesla (NASDAQ:TSLA).

3. DoorDash seeks $500M

DoorDash (DOORD) is reportedly raising for a $500M round that would push its valuation to between $6B and $7B. Temasek is expected to lead the round. DoorDash has already raised nearly $1B in funding from backers that include SoftBank and Kleiner Perkins. Valuation was $4B when the company raised $250M last year.

Earlier this year, DoorDash expanded its operations to cover all 50 U.S. states. The company has also reportedly started to supplement its driver income with consumer tips, similar to Instacart.

Competitor: GrubHub (NYSE:GRUB), Uber (UBER) Eats, and Postmates (POSTM), which filed for an IPO earlier this month.

4. Reddit confirms Tencent investment

Tencent (OTCPK:TCEHY, OTCPK:TCTZF) pitched in half of the confirmed $300M round in Reddit, the “front page of the internet.” TechCrunch reported on the investment last week, and the confirmation followed. The Series B round also included Sequoia, Fidelity, and Snoop Dogg and brought the valuation up to $3B.

Reddit generated $100M in revenue last year and plans to double the figure in 2019. As of late November, Reddit had 330M average MAUs and 14B screen views per month. Tencent’s investment rankled some Reddit users, but the company says it has no plans to create a censored version of the platform for the Chinese market, where the site is currently blocked.

5. Credit Karma for businesses gets $44M

Goldman Sachs (NYSE:GS) participated in a $44M round in business credit startup Nav. Point72 Ventures and Experian Ventures. As part of its investment, Goldman’s investment group managing director Rana Yared will join Nav’s board.

Nav essentially serves as a Credit Karma for small businesses, showing their credit scores from the major consumer and commercial credit agencies for free, which makes it easier for the company to know its financing options. Nav’s platform also contains over 100 financing products including loans and credit cards. Those payment partnerships are how Nav makes its money.

Editor’s Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.

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OYO raises close to USD 1B from Chinese conglomerate Didi Chuxing

… in September 2018, from SoftBank and other investment firms including Sequoia Capital, Lightspeed Venture Partners and Greenoaks Capital.
OYO raises close to USD 1B from Chinese conglomerate Didi Chuxing

India’s leading hospitality company OYO has reportedly raised funding worth USD 100 million from China’s ride-hailing giant Didi Chuxing to close its ongoing USD 1 billion investment round. As per trusted sources, many companies including Japan’s SoftBank and Grab, a Singapore-based ride-hailing company have already invested USD 900 million as part of the USD 1 billion investment round.

Trusted reports claim that OYO raised USD 800 million in September 2018, from SoftBank and other investment firms including Sequoia Capital, Lightspeed Venture Partners and Greenoaks Capital. Post this accumulation, the company raised USD 100 million more from Gram to equal the overall amount of the round to USD 900 million.

According to sources familiar with the development, OYO, run by Oravel Stays Pvt. Ltd has been expanding immensely with its services now available in 500 cities across eight countries namely India, Nepal, China, Malaysia, Indonesia, Philippines, UAE and UK. As a part of its hospitality chain, OYO presently runs more than 13,000 franchises or leased hotels and more than 6,000 homes. In India, the firm holds presence in over 180 cities with over 8,700 properties.

A report from The Economic Times claims that the relationship between Didi and OYO goes back to the year 2017 when the latter had leveraged Didi to declare its entry into China. Reliable sources claim that Didi is certain to join forces with OYO as it expands its reach into newer regions and the two are likely to strengthen their alliance as they both extend the scope of their business operations worldwide.

Agarwal, Group CEO & founder, OYO, has apparently been quoted stating that a major amount of the accumulated capital will be spent in expanding OYO’s fast-growing business across India and China.

There have been speculations that OYO may soon make its foray into the United States as well.

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Uber narrows losses to $1.8bn in 2018 but revenue growth slows ahead of IPO

Read more: Lyft to pitch fast growth to investors as IPO race with Uber … Rival ride-hailing company Lyft has trebled its reach in the past two years and …

Uber narrowed losses last year but saw revenue growth slow dramatically in the fourth quarter ahead of its IPO.

The ride-hailing app said revenue grew just two per cent in the final three months of 2018 to $3bn (£2.3bn), a slowdown from the 38 per cent rise the previous quarter.

Read more: Lyft to pitch fast growth to investors as IPO race with Uber intensifies

Revenue for 2018 as a whole was $11.3bn – up 43 per cent on the previous year.

Full year losses narrowed, down 15 per cent from 2017, but the company still reported losses of $1.8bn, which may concern investors ahead of its eagerly-anticipated IPO.

The company continued to grow its global reach, reporting that annual bookings rose 45 per cent and generated $50.2bn over 2018, including its food delivery service Uber Eats.

The San Francisco-based firm filed for an an initial public offering (IPO) with the Securities and Exchange Commission (SEC) in November.

“Last year was our strongest yet, and Q4 set another record for engagement on our platform,” chief financial officer Nelson Chai said.

“In 2018, our ride-sharing business maintained category leadership in all region we serve.” he added.

Rival ride-hailing company Lyft has trebled its reach in the past two years and now serves 600 cities in North America.

Lyft is also preparing for an IPO and has been pitching its rapid growth to investors to get ahead of Uber in the race to list.

As a result of Lyft’s rise, Uber’s profits from US rides have dropped and separately it has lowered driver fees in South America to ward off other rivals.

Read more: Uber loses appeal over driver employment rights

Both are expected to launch their IPOs later this year.

“Uber needs to show it can control costs and can make money, basically provide a strong argument that its business model is not broken and that it can achieve and sustain profitability despite issues with drivers, customers and politicians,” David Brophy, professor of finance at University of Michigan’s Ross of School of Business said.

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Uber’s business slowed dramatically in the fourth quarter as it gears up for an IPO

Dara Khosrowshahi Getty. Uber’s loss dropped to $370 million last year from $4.5 billion in 2017, the company reported Friday. But its bottom line was …

Dara KhosrowshahiGetty

  • Uber’s loss dropped to $370 million last year from $4.5 billion in 2017, the company reported Friday.
  • But its bottom line was boosted by the sale of two of businesses.
  • And its growth rate slowed dramatically in the fourth quarter; sales grew just 2% from the third quarter and only 25% from the holiday period of 2017.

Uber dramatically narrowed it loss last year, thanks to the sale of its businesses in Russia and Southeast Asia, the company reported Friday.

But its business slowed dramatically in the fourth quarter, and without the asset sales, it would have posted a loss of more than $1 billion.

The app-based taxi service lost $370 million on sales of $11.3 billion in 2018, the company said. Uber showed improvement on both its top and bottom lines for the year; in 2017, it lost $4.5 billion on $7.5 billion in sales.

Uber’s bottom line benefitted from the business sales. Excluding those and certain other charges and benefits, the company would have lost $1.8 billion last year. On that same basis, Uber lost $2.2 billion in 2017.

Read this:Uber booked $2.2 billion in sales last quarter — but it still took a $1.1 billion loss

In the fourth quarter, the company lost $865 million on $3 billion in sales. In the same period of 2017, the company lost $1.1 billion on sales of $2.2 billion.

On the revenue side, it showed a growth rate of just 25% — far slower than the 43% pace the company posted for the whole year, and well below the 61% annual growth rate Uber recorded in 2017.

What’s more, the company’s sales were up only 2% in the fourth quarter from the third quarter last year. Also, its take rate — its commission on what customers pay for Uber rides — declined from both the year-earlier period and the third quarter.

That slowdown could worry prospective investors as the company gears up for its initial public offering. The company confidentially filed its paperwork for an IPO last month, The Wall Street Journal reported.

Uber ended 2018 with $6.4 billion in cash. That was up from $4.8 billion at the end of the third quarter.

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Ride Hailing Giant Uber’s Global Revenue Up 43% In 2018

Uber has clocked in annual revenue of $11.3 Bn in 2018. It narrowed down its loses to $1.8 Bn in the year. UberEATS accounted for over $2.5 Bn in …

Global ride-hailing company Uber has reportedly clocked in annual revenue of $11.3 Bn (INR 80, 641 Cr) in 2018. This is a 43% increase from 2017. The company also narrowed down its losses to $1.8 Bn (INR 12,845 Cr) last year from $2.2 Bn (INR 15,700 Cr) loss in 2017.

Uber has reportedly recorded $50 Bn (INR 3.5 Lakh Cr) in total bookings for its cab and food delivery services combined in 2018.

According to reports, Uber racked up a revenue of $3 Bn (INR 21,409 Cr) for its fourth quarter which is just 2% growth from the third quarter. However, the company’s gross bookings for the fourth quarter increased by 11% from the last quarter to reach $14.2 Bn (INR 1 Lakh Cr).

Citing sources, a media report stated that its food delivery service UberEATS accounted for over $2.5 Bn (INR 17, 840 Cr) quarterly bookings.

Uber which globally faces competition from Ola in India, Didi Chuxing, and Lyft has been trying to attract more customers by offering discounted rides, increasing driver commissions and is also investing in marketing and recruiting. It is also taking up many initiatives to step up its game in the food delivery business. However, these may also put pressure on the company’s bottom line.

US-based Uber had filed the paperwork for an IPO on December 2018. In January, the company had said that it recorded an increase nearly 20X in its revenue from its India business — Uber India Technology — reaching $3.05 Mn (INR 21.7 Cr) in the fiscal ending March 2018.

The company which considers India as a high-potential market has been taking up several initiatives to strengthen its presence in the country and stay ahead of its Indian rival Ola.

Last month, Uber revealed its plans to double its investment in Bengaluru and Hyderabad in terms of headcount, especially in the engineering division.

It is looking to increase the total number of employees to 1,000 in both the centres within the next 12 months. This hiring forms a part of the company’s plan to make India the base for building and experimenting with new products and export them to international markets such as Latin America and Africa.

In December, an internal email shared by Uber India head Pradeep Parameswaran to CEO Dara Khosrowshahi revealed that Uber India recorded an annualised booking rate of $1.64 Bn (INR 11,703 Cr) in the third quarter. It was also reported that India accounted for 11% of the total trips received by the platform from across the globe.

Last year in May, Dara Khosrowshahi had also reiterated that Uber would continue to reinvest in its products and technology across emerging markets such as India and the Middle East.

[The development was reported by ET]

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