PayPal, a San Jose, California-based online payments platform, as per recent reports this week, has announced its plans to make an investment of $500 million in Uber Technologies Inc., a San Francisco, California-based transportation network company. Reports are that the ride-hailing platform Uber, is all geared up and ready to unveil its term plans for the initial public offering (IPO) on Friday.
As per reports, PayPal plans to invest in Uber via a concurrent private placement at the IPO price. This investment is going to benefit Uber in unprecedented ways, a financial services partner is critical for Uber as it plans its way through to become a “superapp” of logistics and transportation services.
Superapps is the general term coined for applications that have their hands into a bunch of services for customers to go for ranging from transportation, shopping, and payments. The bearer of reigns to such apps can be much more appealing and rewarding than those that offer just one core business or service.
Furthermore, it is expected that Uber will seek investors to value itself at between $80 billion and $90 billion. This valuation is, in fact, lesser than its $120 billion valuation that investment bankers hoped Uber could fetch last year, and a tad bit more, closer to its $76 billion valuation at its previous private fundraising round held last year.