
Uber just closed a $1B round of funding for its China branch - doppp
http://www.businessinsider.com/ubers-china-arm-just-closed-a-1-billion-round-of-funding-2015-8/
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netcan
An interesting possibility for Uber in China, assuming they "win," is that the
timing could work for leapfrogging car ownership.

The timing is right for that in china. They're just entering where more centre
of the curve people can afford cars, but most don't yet. It's not ingrained in
the culture yet, so they will be more open to alternatives.

Also, with driver salaries are lower in China that US & Europe and that will
reflect in uber prices. This means that the uber/private car equation is more
weighted in Uber's favor.

Between those two things, it gives uber a decent shot at becoming a top tier
mode of transport.

The crazy thing about the market Uber is biting is that it is a massive,
massive market. Once you start talking about about market share in
_transport,_ you are in crazy territory.

Side note: It's pretty wild how much money is available in the "private"
markets these days.

So, I agree with other commentors that (1) the scale of money coming in is
confusing the definition of "startup" stage and (2) I agree that the risks are
pretty substantial. That said, (A) the potential reward is pretty hefty too
and (B) they seem to be actually operating as an enormously oversized startup.
They're taking startup-ey risks and developing the product-market in a
startup-ey way. IE, it seems that their current form is not their medium term
goal.

Say what you will about Uber, they have balls.

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monkeyprojects
That is a hell of a risky investment given the approach the Chinese
competitors are using in China is to block Uber's access to the devices most
people book rides on...

see [https://pando.com/2015/08/24/wechat-blocks-uber-its-step-
one...](https://pando.com/2015/08/24/wechat-blocks-uber-its-step-one-didi-
kuaidi-using-ubers-playbook/9ac6400d1a40d371cfea75e8c28eba9bc0430f9d/)

~~~
erikb
And not just them. In China you always need political support to succeed. I
don't think they have spent the last 10 years making Guanxi there. And the
current leadership is also not very pro America.

~~~
tew28
I'm on the ground here in China. Uber's used their tactic of going head-on
against government and regulation when they started out here, and it didn't
work. I think they underestimated the speed and ferocity of local competitors,
and didn't put enough emphasis on the political savvy needed to get popular
and government support. They've recently made some well-connected hires and
partnered with some powerful allies like their investors here, but they are
now playing catchup. I'd also be concerned that their connections are of the
mercenary type, and would be less likely to take up Uber's cause at the
expense of heightened political risk, if it came down to it.

Edit: grammar

~~~
erikb
Yeah, political mismanagement can even end in your employees getting hit by
Chinese gangsters, your company losing their rent contract and webserver
without reasons etc. On the other side, if you have government backing your
competitors are no problem because they experience these "accidents".

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contingencies
China has had non-Uber, Uber-like services for years. I've _never_ heard of
anyone using Uber here, then again I don't spend time in the megacities.

The main service I am aware of is _dididache_ or 嘀嘀打车 in Chinese which was
apparently launched in 2012 (same as Uber).

My observation is that a lot of people just call their preferred driver, too.
In the event that the driver is busy, they generally forward the business to a
trusted friend. It's pretty hard to compete with free, personally reputation-
audited referrals and 24 hour service.

Further, only certain cities have functional traffic: Chengdu being a prime
example. Many Chinese cities' road networks have been so oversubscribed by the
millions of new cars that have appeared in the last half decade or so that
calling someone to pick you up is a physically impossible model during large
portions of the day.

Yet another source of competition are e-bike or e-trike taxis, which have a
few hundred dollar entry cost, hang around on many city corners, are totally
unregulated and generally faster and cheaper (5-15元 = $1-3) than regular taxis
(due to lack of road space).

I am skeptical Uber can generate any profits whatsoever in this market.

~~~
zhte415
I completely back this up.

I've also never heard of anyone using Uber, though it is an option and I'm
sure a few do.

Didi and Kuaidi are by-far the leaders, completely entrenched. I think first-
mover advantage will be the case here. The big thing these services are now
competing on however is not hailing a ride, it is providing financial services
through the app. They're no longer ride-hailing apps, they're finance apps
with the option to hail.

[Perhaps a big difference with Uber compared to the US, is the use of it by
taxis. Almost all taxis are on Didi/Kuaidi (indeed, these were taxi-only
services at the start) and taxis are inexpensive.]

~~~
butwhy
"I've also never heard of anyone using Uber" \- well they wouldn't be raising
a billion dollars if everyone already used it, would they?

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msoad
When a company raises so much in "start up" mode wouldn't it be harder to turn
it into a profitable public company?

~~~
dylanjermiah
Uber probably isn't going public anytime soon. They've got at least 6+bn in
the bank and will do 5bn gross in 2016.

~~~
rokhayakebe
$5B in 2016. And one can see Uber growing 10 times bigger.

~~~
dylanjermiah
Well, that's 5bn on 25bn in bookings. Once there's no driver it'll immediately
be 5x higher gross. By the time that comes, I have no idea, Uber will be far
larger. Easily see them doing 100bn/year

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ylem
Just curious--I believe that you can use WeChat to book a ride using some of
Uber's competitors. Can you book an Uber using WeChat?

~~~
ylem
Sorry for my laziness. A bit of googling reveals:
[http://economictimes.indiatimes.com/small-
biz/startups/ubers...](http://economictimes.indiatimes.com/small-
biz/startups/ubers-quest-to-win-over-china-faces-wechat-
hurdle/articleshow/48675838.cms)

and

[http://venturebeat.com/2015/08/24/ubers-wechat-drama-
exposes...](http://venturebeat.com/2015/08/24/ubers-wechat-drama-exposes-the-
unique-challenges-of-winning-in-china/)

Apparently they've been blocked from WeChat...

