Car-booking app Uber is understood to be close to raising another US$1bn in a venture capital round that would value it between US$35bn-US$40bn, a new record for the current slew of Silicon Valley start-ups.
Tech valuations appear to have gone beyond the atmosphere and into the ridiculous zone where there is no oxygen for the brain.
Uber, along with players such as Airbnb and Dropbox, had been part of an exclusive group that had valuations of US$10bn.
However, Uber has seen its value quadruple in just one year. A US$1.2bn financing round in June gave Uber a record high valuation of US$17bn for a start-up app that is only a few years old. In 2009, Travis Kalanick and Garrett Camp set up the company in San Francisco, California.
It is understood that T. Rowe Price Group Inc is in discussions to be a new investor in Uber, while existing investor Fidelity Investments is also planning to invest in the next funding round of US$1bn.
A global tech bubble?
According to Bloomberg, this has become something of an international malaise. In China, up-and-coming smartphone maker Xiaomi is in talks for a funding round that would value it between US$40bn and US$50bn.
A US$40bn value would put Uber at 1.5 times the capitalisation of Twitter and give it the same capitalisation of Salesforce.com, Delta Airlines and Kraft Foods.
While Uber may be an investors’ darling, the app has blundered its way into uber-embarrassing situations that ought to unnerve even the steeliest of Silicon Valley investors.
Uber has faced criticism for claiming that smear campaigns against critical journalists is the way forward. Uber has also faced criticism for its hiring policies and sexist marketing campaigns in some parts of the world.
The app has also begun facing opposition from cities such as Berlin and Toronto, which have railed against it entering their jurisdictions.
Car on road image via Shutterstock