Uber Technologies has successfully acquired Dubai-based ride-hailing rival Careem for $3.1 billion, marking a big step in the growing Middle Eastern market ahead of its initial public offering.
Founded in 2012 by Mudassir Sheikha and Magnus Olsson, Careem started in Dubai and has since grown to 22 cities across the Middle East, North Africa and Asia. Its Pakistan operations commenced in late-October 2015 and expanded into offering rickshaw and motorcycle services recently. In end-November Careem became the first Middle East startup to achieve the $1 billion or a unicorn valuation, highlighting its ascendancy in the region.
According to Uber Technologies CEO Dara Khosrowshahi, Careem has “played a key role in shaping the future of urban mobility across the Middle East, becoming one of the most successful startups in the region”. Uber hopes the deal will speed up the delivery of digital services to people in the Middle East through the development of a consumer-facing super-app that offers services such as Careem’s digital payment platform (Careem Pay) and last-mile delivery (Careem NOW).
Integrating car sharing allows customers to make even more informed choices about how they get from A to B and ensure they travel as sustainably, cheaply and efficiently as possible. With the digital key on the smartphone, they revolutionize the rental process and give the customers more time to enjoy themselves.
Fueled by the rise of digital technologies — which allowed owners of goods to be matched quickly with those who needed them — the sharing economy was meant to spur higher levels of social efficiency. Therefore, firms such as Uber Technologies resorted to business strategies that “completely walked back the original sharing economy concept”. These included providing rental vehicles to drivers offering ride-sharing services, and devising incentive and reward schemes to woo full-time drivers.
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