Via said Thursday it has raised $100 million from a group of financial and strategic investors. The Israeli-U.S. startup enables riders to team up to get to their destinations quickly and cheaply.
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The startup, which is headquartered in New York and has an R&D center in Tel Aviv, provided few financial details. However, the fundraising makes it only the fourth Israeli startup ever to raise $100 million or more, and probably values the company in the hundreds of millions of dollars.
That leaves it short of the $1-billion minimum to qualify as a “unicorn,” but it’s an impressive achievement given the chill that has overtaken high-tech fundraising in the United States and the competition Via faces from larger companies like Uber and Lyft. Only a year ago, Via raised $27 million.
Via said it closed on $70 million of the total from a group led by the Israeli venture capital fund Pitango Growth, which was joined by venture capital firms – including Poalim Capital Markets and C4 Ventures – and private investors. Existing investors, including the Russian oligarch Roman Abramovich, Hearst Ventures and Israeli venture fund 83North, also participated.
Via said another $30 million would be coming from a strategic investment in the coming weeks. Those funds will bring Via’s total fundraising since it was formed four years ago to $137 million.
Only three other Israeli startups have ever raised $100 million or more: Content-sharing company Tabula secured $117 million a year ago; Landa Digital Printing raised 100 million euros ($114 million at current exchange rates) two years ago; and Gett, another ride-hailing service, raised $150 million in 2014.
Operating in New York and Chicago, Via enables people to share their ride with others headed the same way, using algorithms that dynamically match riders with available seats in private vehicles, instead of one car to one rider. The algorithm’s smart-outing allows passengers to be picked up and dropped off without taking riders out of their way to accommodate other passengers.
Via said the financing would be used to expand in New York and Chicago, introduce the service in other cities, and aid municipalities and transit authorities seeking to improve transit services using Via’s technology.
In addition, Via said the funds would support strategic partnerships, such as the collaboration with Mercedes-Benz underway in Orange County, California.
Oren Shoval, chief technology officer and a cofounder together with CEO Daniel Ramot, said Via sees its ride-sharing technology as an alternative to mass transit by turning private vehicles into components of the system.
“We’re reinventing public transportation, which demands a lot of resources,” said Shoval. “We’re showing that it’s possible, with relatively modest investment, to improve transportation systems at costs many times lower than investing in buses and light rail. We think we can deliver the same thing efficiently and at lower cost.”
Uber and Lyft provide similar pooled-ride offerings, which they have been promoting heavily in recent months. Uber’s UberPool says it provides 100,000 rides a week in New York, while Lyft has estimated that about 30% of its traffic comes from its similar Lyft Line service.
However, right now Via is bigger in New York, claiming 125,000 rides a week in Manhattan, according to The New York Times, which said Via’s membership has quadrupled over the past 12 months to 250,000.