New York investment firm Greenbriar is set to buy a $500m stake in Uber’s logistics arm, Uber Freight, valuing the goods transportation business at $3.3bn.
On Friday (2 October), Uber announced that New York-based investment firm Greenbriar Equity Group is set to invest $500m in a Series A preferred stock financing for its logistics arm Uber Freight.
In a statement, Uber said that this agreement values Uber Freight at $3.3bn on a post-money basis. The California-headquartered transport business will maintain majority ownership of Uber Freight, while Greenbriar managing partners Michael Weiss and Jill Raker will join Uber Freight’s board of directors.
Uber’s logistics business, which launched in 2017, aims to simplify the movement of goods through a digitally enabled carrier network. Its carrier tools enable trucking companies and drivers to book loads in a similar manner to how Uber’s ride-hailing drivers book journeys with passengers.
The platform provides a suite of on-demand logistics technologies, APIs and software integrations to provide shippers with the ability to plan, budget, tender and track their freight.
Scaling the platform
The investment from Greenbriar comes at a challenging time for Uber, which has seen a decline in its core ride-hailing business as a result of the Covid-19 pandemic. Earlier this year, Uber closed 45 offices and laid off around 6,700 employees.
The company’s chief executive, Dara Khosrowshahi, said that these measures would help Uber cut costs by $1bn to keep the business on track throughout the pandemic. The company also offloaded its bike-sharing division Jump to electric scooter company Lime.
Uber said that it will use the latest investment from Greenbriar to scale its logistics platform and accelerate product innovation to equip shippers with technology to power their supply chains. According to TechCrunch, the Uber Freight business unit remains unprofitable.
Since it was launched, Uber Freight has gone on to expand into Europe and Canada. It established a headquarters in Chicago last year as part of plan to invest in the region and hire 2,000 employees over the next two years.
Lior Ron, head of Uber Freight, said: “We are tremendously proud of what we have accomplished in a few short years. We have led the industry with technology, transforming dated and analogue processes to ensure that both shippers and carriers are equipped to succeed in a rapidly changing industry.”
Ron added that the company is “thrilled” to enter its next chapter with Greenbriar. “We will continue to leverage Uber’s leading marketplace technology, global reach and cross-platform capabilities to accelerate our growth and continue to lead the industry forward.”