If you read my source, you'll see that it does support my argument:
>Indeed, India is a vast market that accounts for 10 percent of Uber’s trips with 10 million rides a week, so ceding ground there will be undoubtedly damaging to the company.
>“India is a key component of our growth plan,” Khosrowshahi told the Economic Times during a recent trip to India. “If you look at the market, it’s one of our healthiest markets in terms of growth rates.”
>In Latin America, the company has seen incredible success as the region quickly became its fastest growing.
In India, there might be no Uber left very soon[1]:
> This rivalry has been less welcome to Japanese technology giant SoftBank, which holds large stakes in both Uber and Ola. Encouraged by their common shareholder, the pair have held talks on a potential merger, according to people with direct knowledge of the discussions. That move would create a business controlling almost the entire Indian ride-hailing market, which last year had revenue of at least $2.1bn, according to RedSeer Consulting.
The same will probably happen in Latin America, where Didi bought 99 taxis, a Brazilian-based ride hailing company that it is specifically focused on dominating the region[2].
In the long run, I expect Uber as a brand to exist only in English-speaking markets.
Let's say that GV had the opportunity to sell to SoftBank at a valuation of 50B. Let's just guess that they would getting a 500X return. Maybe they invested 1M early at a 10M valuation and got diluted to ~1% ownership. So 1% of 50B is 500M on a 1M investment.
This is a great return for them. Congrats to all involved.
But this could be considered something of a low-end valuation. Maybe it's more... maybe Uber can IPO at a 100B valuation. The difference between a 500X and 1000X exit is huge, but risky. Maybe they end up IPO'ing at only a 40B valuation. GV would still have a 400X exit. This is the risk GV would have to gauge.
Now, if you're one of the later investors and spent 100M for 1%, then the (respective) numbers would be 5X (500M for a 100M investment), 10X, and 4X. For an late round investment like this, you may chose to exit at a locked in 5X, deeming the risk of a 4X exit too great.
Thus my comment that earlier round investors would be less sensitive to whatever the ultimate IPO valuation is. A 400X exit would make a fund. A 4X exit, while good, isn't great.
Again, I don't know the numbers and I suspect they are all significantly higher. I picked numbers that made the math easier. I also don't know who ultimately ended up cashing out (or when). So really, this is all speculation. But if anyone has the numbers, I'd love to know them!
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[ 6.2 ms ] story [ 37.7 ms ] thread>Indeed, India is a vast market that accounts for 10 percent of Uber’s trips with 10 million rides a week, so ceding ground there will be undoubtedly damaging to the company.
>“India is a key component of our growth plan,” Khosrowshahi told the Economic Times during a recent trip to India. “If you look at the market, it’s one of our healthiest markets in terms of growth rates.”
>In Latin America, the company has seen incredible success as the region quickly became its fastest growing.
> This rivalry has been less welcome to Japanese technology giant SoftBank, which holds large stakes in both Uber and Ola. Encouraged by their common shareholder, the pair have held talks on a potential merger, according to people with direct knowledge of the discussions. That move would create a business controlling almost the entire Indian ride-hailing market, which last year had revenue of at least $2.1bn, according to RedSeer Consulting.
The same will probably happen in Latin America, where Didi bought 99 taxis, a Brazilian-based ride hailing company that it is specifically focused on dominating the region[2].
In the long run, I expect Uber as a brand to exist only in English-speaking markets.
[1] https://www.ft.com/content/af3aab5c-52d6-11e8-b3ee-41e020920...
[2] https://www.bloomberg.com/news/articles/2018-01-03/didi-buys...
Let's say that GV had the opportunity to sell to SoftBank at a valuation of 50B. Let's just guess that they would getting a 500X return. Maybe they invested 1M early at a 10M valuation and got diluted to ~1% ownership. So 1% of 50B is 500M on a 1M investment.
This is a great return for them. Congrats to all involved.
But this could be considered something of a low-end valuation. Maybe it's more... maybe Uber can IPO at a 100B valuation. The difference between a 500X and 1000X exit is huge, but risky. Maybe they end up IPO'ing at only a 40B valuation. GV would still have a 400X exit. This is the risk GV would have to gauge.
Now, if you're one of the later investors and spent 100M for 1%, then the (respective) numbers would be 5X (500M for a 100M investment), 10X, and 4X. For an late round investment like this, you may chose to exit at a locked in 5X, deeming the risk of a 4X exit too great.
Thus my comment that earlier round investors would be less sensitive to whatever the ultimate IPO valuation is. A 400X exit would make a fund. A 4X exit, while good, isn't great.
Again, I don't know the numbers and I suspect they are all significantly higher. I picked numbers that made the math easier. I also don't know who ultimately ended up cashing out (or when). So really, this is all speculation. But if anyone has the numbers, I'd love to know them!