SoftBank Emerges As The Biggest Challenger To Uber



If you live in the U.S., the chances are that your definition of the biggest rival to Uber is Lyft. The ride-sharing service operates in many of the same U.S. cities as Uber, and the two have a keen rivalry, which includes some less-than-ethical practices on both sides. But a new, less obvious, force has emerged out of Asia to offer Uber its stiffest competition yet: and surprisingly it is a telecom company.

SoftBank had no business in taxi-hailing apps until October 2014 when it led a $210 million investment in India’s Ola. That deal was announced as the first investment in SoftBank’s program to put $10 billion into startups in India. At the time, Ola appeared to be just one of a number of deals in India — while that is true, it also turned out to be the first of an expensive set of investments in companies rivals that rival Uber.

SoftBank went on to invest $250 million in GrabTaxi in Southeast Asia, and last week it closed a third deal, leading a $600 million financing round for China’s Kuadi Dache.

The operator, it seems is going all out for taxi apps but it may not stop in Asia.

Alibaba led Lyft’s $250 million funding round in April 2014, which the U.S. company had earmarked for “international expansion”. At the time, the investment was a curious deal for Alibaba but, with the e-commerce giant backing range of other U.S. startups — including chat app Tango — it looked like an exploratory move to get some skin in promising companies in North America.

However, SoftBank and Alibaba have a long history of collaboration — SoftBank is famously an early investor in Alibaba, and both companies put money into Kuadi Dache — and it could just be that Lyft forms a part of SoftBank’s taxi app focus. Perhaps the Japanese firm will put its own money in at a later date, or it will use its relationship with Alibaba to form a loose alliance to share information and tactics.
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