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Uber Backers Discuss Stock Sale to SoftBank, Others (bloomberg.com)
Eric Newcomer, Olivia Zaleski, Dinesh Nair, and Alex Sherman, reporting for Bloomberg: Uber shareholders and its board, led by early backer Benchmark, have discussed selling some of their shares to Japan's SoftBank and other potential investors, people familiar with the matter said. The talks represent a major turning point for the company. It has amassed more than 500 investors who fought to own a piece of the world's most-valuable startup. The fact that some of the earliest backers now want to reduce their stakes suggests the scandals and other troubles this year have taken a toll. The deal could include an injection of new money into the ride-hailing startup, the people said. They asked not to be identified discussing private deliberations. It's unclear what valuation those shares would carry or how much may be sold. Any private share sale like this would need to be approved by San Francisco-based Uber's board. Uber's former Chief Executive Officer Travis Kalanick, who remains on the board, didn't learn about Benchmark's effort to sell early shares until recently, two people familiar with the matter said. Kalanick has often opposed allowing early shareholders to sell their stakes, though the board has allowed occasional exceptions. Even though Benchmark led an investor revolt against Kalanick, at least three major shareholders said they were unaware of Benchmark's effort to sell shares as of Friday morning, three people familiar with the matter said. SoftBank, which recently launched a $93 billion technology fund, has no plans to invest in Uber, a person close to the Japanese company said. SoftBank has backed Uber's primary rivals in India, Southeast Asia and China. Some of Uber's investors would like to see the startup cut deals with overseas competitors -- as it did with Didi Chuxing in China and Yandex NV in Russia. Grab, a leading ride-hailing startup in Asia, is raising as much as $2 billion from backers including SoftBank and Didi.
Exciting news. Rich people sell stuff to other rich people. Truly news that matters.
Uber was founded in 2009. Now we're eight years in, the company has thousands of employees and millions of drivers working for them, yet still called a "startup"?
I think I have to amend my idea of what "startup" means.
Masayoshi Son has a 200 year plan for his company and wants to live that long. Believes telepathy will become the leading form of communications in the future and wants in from the ground floor. That 100 billion dollar tech "US" fund is just for show. It's a means to appease US regulators in various Softbank holding in US.
Hybrid between Elon Musk and Peter Thiel.
The stock is probably slightly over valued and the major holders want to do what investors do, and move out of a stagnant market and find new places with higher returns. People like the services, but there is market saturation. We see the same exact scenario with other tech companies, like Facebook and LinkedIn. There are only so many people in the world, so many people that can use (or have interest in using) a service, or ads that can be displayed at any given time.
-The wise argue that there are few absolutes, the fool argues that there are no probabilities.
Meanwhile Masa allegedly soliciting off loading some of its Sprint. Perhaps they can swap some Sprint for Uber;) https://www.bloomberg.com/news...
There's also the minor problem that no one can figure out how Uber could ever earn a return on the money invested. That might be a reason some of the early investors are looking for new suckers.
... it's gonna be huge!!!!
Uber uses VC billions to temporarily reduce the cost and improve convenience of a taxi ride. When VC is gone, cost and convenience will normalize. Even putting self-driving cars into the equation can't save Uber. With autonomous vehicles, Uber and affiliates won't be externalizing cost of car ownership, fuel, maintenance, etc. Uber can succeed only if it permanently wipes out all competition, after which prices must rise.