Uber has dominated on the global ride-hailing space scene for a while now, but this space could start to get crowded and the Daimler-led $175-million fundraising for European-based Taxify ups the ante in the race for global dominance.
If you haven't heard of it, Taxify is an Estonian company, and if no one is convinced that it could rival giant Uber, consider this: It's just secured a $1 billion valuation thanks to the $175-million-round of funding, and everyone from German automaker Daimler to UK-based money transfer start-up TransferWise and French VC fund Korelya Capital participated.
Last year, it got a boost by sealing a partnership deal with China's ride-hailing giant, DiDi, which also participated in the recent funding round.
Taxify is still small compared to Uber, but the potential is big and while this space could get crowded, it's not crowded yet. And it's also starting in Europe, where it's hoping for the local advantage over the Uber ride-hailing master.
Right now, Taxify has some 10 million passengers signed up to its platform and 500,000 drivers in 40 cities on four continents. That compares to Uber's 80 countries and almost 700 cities.
But this Estonian unicorn is just getting started. Already, it's expanding into Western Europe, where it's conquering London and stealing some of Uber's market share by tossing a bit of competition into the arena.
It's also expanding into Africa, where it's already Uber biggest rival.
Related: Court: Petrobras Strike Is Illegal
London wasn't such a difficult fight for Taxify, given Uber's mounting challenges there, particularly over the classification of drivers as formal workers instead of self-employed.
Not only is Taxify trying to beat Uber by promising cheaper fares, but it's also trying to steal Uber drivers by promising better pay with the company taking a lower commission.
So why is Daimler so interested?
"Taxify is an ideal addition to our existing and extensive mobility services portfolio," said Joerg Lamparter, head of mobility services at Daimler Financial Services.
But Daimler seems to be interested in pretty much every company that could rival Uber outside of the United States.
Daimler has thrown itself wholeheartedly into this space, with a major ownership stake in MyTaxi-a dominant online taxi company in Germany, which also competes against Uber in Britain, Ireland and Spain. The German automaker also has a stake in Uber rivals Chauffeur-privé of France, and Careem, which operates in cities across the Middle East.
Daimler has also invested in Flinc, a German carpooling start-up, and the German carmaker also has its own transport-booking app, Moovel, which has a user base of 2.5 million and which Taxify may gain access to.
Related: U.S. Oil Exports Eat Into OPEC Market Share In Asia
Despite Uber's struggles, though-and even its retreat from several regional markets, including Southeast Asia-it's still the world leader outside of China, and last year even launched a JV with Russia's ride-hailing Yandex, even if it did have to take a back seat on ownership.
Uber is turning out to be the gateway drug for the ride-hailing business, and unicorns who sat backed and watched the pioneer's challenges are jumping in with the advantage of Uber having cleared some major hurdles for them. Now the pioneer is about to be challenged on multiple continents.
By Damir Kaletovic for Safehaven.com
More Top Reads From Oilprice.com:
Safehaven.com is one of the most established finance and news sites in the world, providing insight into the most important sectors in the business and… More