Uber Gets Ready For Its I.P.O. And Numbers Are Big, But So Is The Risk



Uber, the Silicon Valley unicorn that started as a ride-hailing platform, is getting ready to go public. Perhaps planning to go public earlier than their original timeframe of later 2019, competition might be stoking the proverbial fires.

Uber has reportedly been offered proposals from banking giants Morgan Stanley and Goldman Sachs that are worth $120 billion. A record-breaking amount to raise from initial public offerings, Uber could stand to make a huge splash in the public investing sphere. But not without a catch or two.

Uber’s almost virulent expansion and growth have been padded by the deep pockets of Venture Capitalists who have understandably wanted their investment to flourish. However, this VC safety net has been problematic for Uber in that their business model has not been a sustainable one. Once in the public investment sector, that becomes a worrisome risk for potential investors.

Meanwhile, Lyft — Uber’s fiercest competitor — is preparing to roll out an I.P.O. by early 2019, aiming to put space between their public debut and Uber’s. Being much smaller than Uber, Lyft may be using this as a strategy to bolster their investable stability, plus it’s nice to be able to say “I got here first!”

“The first ride-sharing I.P.O. will get a lot of attention, so I think there’s some marketing value to being the first one out of the gate,” said Kathleen Smith of Renaissance Capital.

Some are betting that Uber will emerge from a private VC backed ride-hailing platform into being an urban mobility platform. There are nearly 12 million trucks, rail cars, locomotives, and vessels moving goods over the transportation network in the United States. If Uber goes public developed enough that it enters the shipping world alongside ride-hailing, electric bikes, electric scooters, food delivery, and whatever else they may have up their sleeves, their market power would be unprecedented.

It’s not far off. Automated fleets of vehicles, commercial and private, are just around the corner and we’re watching the market brace for something it’s never seen. Exactly who will succeed first — and how well it goes — may write the very future of global transportation.

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