Chinese ride-hailing giant Didi Chuxing (Didi) has made a strategic investment in Careem, a rival service that’s popular in parts of the Middle East, Africa, and Asia.
The investment — for an undisclosed amount — represents part of a broader partnership that will see the duo “share knowledge in intelligent transportation technology, product development, and operations,” according to a statement issued by Didi.
Didi Chuxing was born in early 2015 following a merger between local rivals Didi Dache and Kuaidi Dache. Similar to Uber, Didi Chuxing offers smartphone-based car services, such as carpooling, taxis, and premium vehicles. The company has raised vast swathes of cash in recent times, including $ 5.5 billion earlier this year and $ 7.3 billion last year, which includes a cool $ 1 billion contribution from Apple.
Though Didi is primarily known in its native China, where it claims 400 million users, it has made no secret of its plans to build a “sustainable global mobility ecosystem” through a number of initiatives, including partnerships and investments. In the U.S., Didi has previously invested in Uber rival Lyft, while in India it plowed money into e-taxi giant Ola, as well as Southeast Asia’s Grab.
Founded out of Dubai in 2012, Careem said it has 250,000 drivers across 80 cities in 13 countries, including Pakistan, Turkey, Egypt, Morocco, and Saudi Arabia. It has raised north of $ 500 million in equity funding, including a recent chunky $ 150 million round of financing from big-name companies, including Daimler. Careem confirmed to VentureBeat that Didi’s investment didn’t constitute part of its recent series E round, but what is clear is that Didi is serious about growing its global footprint, as evidenced by its continued outward dealings.
“Growing urban populations and economic and social diversity in the MENA (Middle East and North Africa) region present enormous opportunities for the ride-hailing economy,” said Cheng Wei, founder and CEO of Didi Chuxing. “Careem is the region’s technology and market leader. Through technology exchange and co-development, we look to support continued growth and transformation of the region’s transportation industry, tap into the significant potential of the local internet economy, and foster more innovative services for a broader network of communities around the world.”
Consolidation
Though Uber is an established e-taxi brand in many regions around the world, the U.S. company has struggled to scale quickly enough to stave off the rise of local players in some markets, and this struggle is leading to more rival partnerships and a degree of consolidation across the board. In Eastern Europe, Uber and Russia’s Yandex recently merged their services in a handful of countries, while last year Uber’s China unit was bought outright by Didi. Last summer, Daimler’s MyTaxi merged with U.K. e-taxi company Hailo, and earlier this year MyTaxi acquired Greek rival Taxibeat to take on Uber in Europe.
That Didi is continuing to invest in rival services isn’t surprising, but it gives further insight into how the company plans to grow outside of China — through raising large amounts of cash and investing in rivals in other markets.
Didi is also increasingly courting travelers, having recently launched a new English-language app with real-time translations for in-bound visitors. It has also partnered with Avis to offer car rental services to millions of Chinese travelers while abroad.
