100% Growth, With a Caveat: How Israel’s Microtransit Firm Via Reached a $3.3b Valuation

TransitTech company Via proudly announced $100 million in revenues from smart transit software, but declined to mention presumably low growth in other fields. The company closed a $130 million fundraising round on Tuesday

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Via founder Oren Shoval in 2019.
Via founder Oren Shoval in 2019.Credit: David Bachar
Omri Zerachovitz
Omri Zerachovitz

Early in the COVID-19 crisis, just when people were shutting themselves in, Via raised hundreds of millions of dollars, at a valuation of more than $2 billion. In those days, it was unclear if people would rush back to public transit due to fears of the pandemic, and whether it made sense to invest in a company whose technology enabled dynamic public transport based on traffic conditions, roadwork, passenger needs, available vehicles and more.

A year and a half later, the company has now completed another round of fundraising at a valuation of $3.3 billion (after the money). In this round it added $130 million to its coffers, after raising an additional $60 million last March.

Via was founded in 2012 by Oren Shoval and Daniel Ramot. The company offers dynamic, on-demand transit, based on the idea that a fixed public transit route may often lead to longer rides and sub-optimal service. An example of the use of Via’s technology in Israel is Dan’s Bubble service, which enables users to order a ride on a minibus from any bus stop to another – even if the stops are not on the same bus line – within a given area.

The company has operations in 500 cities worldwide, but the products it offers varies between cities and countries. Thus, in some cities it focuses only on supplying technology – software – without actually serving passengers. In other cities, it operates as a public transit provider, independently or in collaboration with others, operating a smart network of minibuses.

The company emphasizes its income from software, which is faster growing and has larger profit margins. The company is comfortable noting that a few months ago, its income in this category crossed the $100 million threshold.

A Bubble minibus in Tel Aviv: Via's technology in action.Credit: Tomer Appelbaum

However, this is misleading as it leaves out Via’s non-software operations, which are thought to have a significantly lower pace of growth. So, for instance, this figure does not include its income from minibus services in New York City – formerly a flagship operation. As a whole, the company’s income dropped last year due to the pandemic.

Via declined to comment or offer further details, but one can gather that the company does not intend to continue developing all of its diverse range of products. It also seems likely that if the company should one day wish to go public, it will need to make significant moves, such as selling or shutting down some of its operations, in order to show investors a higher growth rate. Either way, the company can’t shut down all of its operating ventures.

The current round of fundraising was led by Janus Henderson, and also included the Blackrock Growth and Innovation Fund, Koch Disruptive Technologies and ION Crossover Partners. Existing investor Exor, a holding company with significant stakes in Fiat, Chrysler, Ferrari, The Economist and Juventus soccer club, also participated in this round. In total, the company has raised close to $800 million over the years. It is working on another round of fundraising to buy back stock from current investors, including employees. Via employs some 1,000 people, including 400 in Israel.

Shoval said the company’s revenue grew because people’s demands changed when lockdowns ended.

“Traffic jams got worse because people don’t want to be in public transit – not just because of COVID, but also because it doesn’t meet their needs. For instance it doesn’t adapt to the fact that the work model is far more flexible. Yet everyone understands that private cars are not the correct way to move around the city, so cities are trying a lot of solutions,” he said.

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