Careem is one of ride-hailing Uber’s lower profile rivals in emerging markets. It has taken a step into the global limelight today after it announced that it has raised $350 million. The round was led by Japanese e-commerce firm Rakuten and Saudi Telecom Company (STC). The investment gives Dubai-headquartered Careem a valuation of $1 billion.
Careem started operating in July 2012. It was initially co-founded by Magnus Olsson and Mudassir Sheikha, both of whom had previously worked as management consultants at McKinsey & Company. Careem was established with the intention of solving the problem of car booking availability.
It was initially founded as a website-based service for corporate car bookings. And it then evolved to become an app after demand increased. So, they pivoted from being a car service targeted at corporate clients to individuals looking to book a local car hire for everyday use.
Four-year-old Careem is present in 47 cities across 11 countries predominantly in the Middle East but also Turkey, Pakistan and parts of North Africa. Across those territories, it claims 150,000 drivers and some six million users. The firm had previously raised $72 million, according to Crunchbase. So this new round — which is its Series D — is a major step up financially.
The money looks like going towards market expansions primarily. Careem recently entered Turkey and it revealed plans to reach 15 new cities across Pakistan, Saudi Arabia and Egypt in December alone. It said it is aiming to create one million jobs by expanding its driver pool. It also pledged to put some of the funds into R&D. Indeed, Careem announced a $100 million research strategy to “accelerate innovation in transportation-related technology infrastructure” in the Middle East.
That’s not quite all, there is more money coming. Careem said that this $350 million allocation is the first tranche of a larger $500 million round that it is currently working on. The company’s didn’t provide a timeframe for when the entire raise will be completed.
Source: TechCrunch (18 Dec.)
