Russia’s largest bank is latest investor in ride sharing app Uber

An uber driver using the app

SBT Venture Capital, the venture arm of Russia’s largest bank Sberbank becomes the latest investor of Uber as it participated in the ride-sharing app’s Series G funding round last Thursday.

The $3.5 billion deal was led by Saudi Arabia’s Public Investment Fund and values the startup at $62.5 billion.

Senior Vice President of Sberbank Mikhail Erenburg said, “Sberbank has the largest accounts base in Russia in mobile bank and plastic cards segments. Uber is the leader in digital on-demand economy, opening opportunities for the most diverse formats of cooperation in interests of our clients.”

Since Uber’s launch in Russia in December 2013, the popular app has amassed an incredible following across 12 Russian cities including Moscow, St. Petersburg and Kazan. Uber even expects to have a presence in evert Russian city with a population of over 1 million by the end of 2016.

Last year, Sberbank and Uber signed a memorandum of understanding “to explore the co-development of financial technology with global potential.”

The bank has expressed interest in other possibilities of partnership with Uber and is actively cooperating with digital economy companies in a bid to smoothen its quality of service for customers.

Uber has in turn shown interest in Sberbank’s mobile payment technologies which can improve the ease with which new Uber users verify their account and make secured payments.

It’s entrepreneur online banking system is another attractive feature that can allow for an improvement in the administration and legal processes involving self-employed drivers.

Niall Wass, Uber’s SVP of operations throughout Europe, the Middle East, Africa and the Asia-Pacific region, said, “Sberbank is at the global forefront of financial technology and we are excited by the opportunities of working with them to deliver even more choice for riders and drivers alike.”

The move will also help Uber tap into a greater pool of Russian customers and drivers.

Additional information on the amount invested was not disclosed although it is speculated to be in the range of $10-$25 million based on the bank’s previous tech investments. The sum is small. Russian billionaire Fridman invested $200 million in the startup back in February.

Not everyone however is happy with Uber’s Russian takeover.

Last year cabbies in Moscow and St Petersburg went on strike against Uber and other ride-sharing apps like Yandex.Taxi and Get.Taxi for their competitive price-cutting.

Moscow has even threatened to ban Uber from operating in the capital unless the company signs a data-sharing agreement with the transport department in a bid to increase the security of both users and drivers.

The situation isn’t exclusive to Russia. Uber has been repeatedly accused of using massive financial cost undercutting to deter local competitors.

Uber does however seem to do good for Saudi Arabia where opportunities beyond oil seem to be abundant.

Yasir Al Rumayyan, the Saudi Arabian Public Investment Fund’s managing director, said in a statement, “As the Kingdom of Saudi Arabia’s sovereign investment arm, we’re focused on achieving attractive long-term financial returns from our investments, while supporting Saudi Arabia’s Vision 2030, the blueprint for diversifying our economy away from oil. This ambitious and far-reaching plan presents a number of goals, including unlocking strategic sectors such as tourism and entertainment, boosting employment opportunities and women’s participation in the workforce, and encouraging entrepreneurship.”

Sberbank controls over 46 per cent of the Russia’s money and now joins billionaires Mikhail Fridman and Alisher Usmanov as investors in the popular mobile app.

The SBT Venture Fund I was founded in 2013 and has $100 million under management and has invested in 11 companies thus far.

Read Also:

India: Ola in talks to raise up to $400m as battle with Uber grinds on

Russian billionaire Fridman’s LetterOne invests $200m in Uber

Russia Dealbook: Sberbank-IIDF launch fintech accelerator, VisionLabs develops project

 

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.