Uber is now recognizable to many, therefore, they are currently, gearing up to raise funds for the long haul. When people elect to pay for a ride service to take them somewhere, it used to be common to hail a taxi. Uber changed the game with its service. The popular company, referred to as a ride-sharing company, provides car service, ordered through their proprietary technological app. To keep the service running smoothly for the long haul, the car service has announced it is preparing to raise more funds, as reported by The Wall Street Journal.
On the Uber website riders begin their quest to order ride service. To reserve a car online, one would enter their name, pick up location and their destination. Once payment is entered, they will then wait for their driver to appear. With the use of GPS, drivers in close proximity of the ride request are alerted that a request has been made. Once the trip has been completed, no cash needs to be exchanged, as this has already been taken care of.
This ease of use has caused Uber to grow in popularity. According to BizJournal, Uber started the trend of requesting car service through a smart phone, alongside Lyft and Sidecar, who offer similar services. Sidecar, whose name is not as prominent as Uber, considers itself the pioneer before Uber raised funding to add more cities to their profile. Lyft became known for its car service, identified by vehicles with a mustache attached to their front end.
Uber differentiated itself at first by supplying its riders with sleek, full size cars to ride in. Then, the car service added to that business model, supplying more diverse cars. Still, those who choose the company’s services range from executives, to those out for the evening, or riders who prefer a more upscale experience.
The marketing messages on the car service’s website lean toward those who prefer a certain type of experience, not found in taxicab service. In fact, it is safe to say that the reason for the car service’s growing popularity is because it differs from that of a taxi.
This popularity is what is fueling the ride-sharing investment opportunity. Uber prepares to retain a competitive edge for the long haul, so raising new funds have become a priority. Reportedly, according to The Wall Street Journal, the company has informed its investors to prepare to take it to the next level. In a prior financing round, roughly five months ago, the company raised $1.6 billion. If all goes as desired, the subsequent financing round could place the company valuation upwards of $30 million.
Unfortunately, as Uber is gaining riders and gearing up for more investor buy-in, the company has been challenged by a number of lawsuits filed against them, as well. According to the Detroit Free Press, in one case, a complaint came against the car service about its’ gratuity surcharge. The gratuity has been seen by some as, in a word, gratuitous.
At issue is the ride-sharing company receives a large portion of gratuities, that under scrutiny, is viewed as an unfair practice. Other legal complaints were made in Chicago, where a group of taxicab drivers filed a lawsuit against the company. Their complaint revolved around the issue that they, as cab drivers, are subject to regulations that Uber drivers are not.
Also in Chicago, the local NBC station launched an investigation into the company, reporting a plethora of concerns. Among them, the background status of the ride-sharing company’s drivers. The local station reported with case studies, of sorts, about how this puts riders at risks.
Uber is experiencing the fact that with success comes a number of challenges, including lawsuits and legal issues. Many have yet to be resolved. As it stands right now, Uber is riding the wave of its’ operating success and, therefore, prepared to raise more funds to strengthen itself for the long haul.
By Karen J. Dabney