Dubai-based ride-hailing app Careem announced today an investment from Didi Chuxing, a Chinese ride-sharing giant. The investment amount was not disclosed.
“Didi Chuxing brings leading edge AI capabilities, insight and expertise to our organization as we enter our next phase of growth,” said Mudassir Sheikha, CEO and co-founder of Careem in a press release. “This evolution in our long relationship will enable Careem to more effectively pursue growth opportunities through continued innovation and sustainability.”
This is the latest in Didi’s aggressive expansion across five continents—in September 2015 Didi invested $100 million in Uber competitor Lyft and in August 2016 partnered with Uber in China, investing $1 billion in the company. It has also invested in leading Indian ride-share company Ola, Southeast Asia’s Grab, Brazil’s 99 and partnered last week with Taxify, a ride-hailing company in Europe and Africa.
“Growing urban populations and economic and social diversity in the MENA region present enormous opportunities for the ride-hailing economy,” said Cheng Wei, founder and CEO of Didi Chuxing in a press release announcing the partnership.
This follows a period of unrest at Uber—founder Travis Kalanick resigned as CEO of the company in June after a shareholder revolt. Uber, which has dominated the ride-hailing business and operates in more than 450 cities, is Careem’s main competitor, but Careem co-founder Mudassir Sheikha believes that his company has an edge in the Middle East.
“Our product is just closer to the needs of the people in this market,” he told Forbes Middle East in October 2016. “We’re much more localized and much more integrated with the local ecosystem.”
In June 2017, Prince Alwaleed Bin Talal invested $62 million for a 7.11% stake in the ride-hailing app as part of a larger $150 million Series E funding round including luxury car maker Daimler. It was Kingdom Holding’s first investment in a tech startup in the region.
This left the startup with a $872 million valuation, down from $1 billion in December 2016 following a $350 million Series D round led by Rakuten Holding and Saudi Telecom Company.
“The opportunity for further expansion in this region is huge, not just broadening and deepening our presence in the broader Middle East markets, but also in driving innovation that can have a meaningful impact on our communities,” said Mudaissir Sheikha, co-founder and CEO of Careem, in a press release announcing Prince Alwaleed’s investment.
Careem, which was founded in 2012 by Mudassir Sheikha and Magnus Olsson, is considering an IPO within two to three years. The app operates in more than 80 cities throughout the Middle East, North Africa and Pakistan.