Mobile app Uber is adding another firm to its growing tech portfolio, and this time the target company is a Snapchat competitor. The San Francisco, California-based company has just acquired Swipe Labs, a San Francisco-based Startup that specializes in the social product that is used to craft better mobile experiences for the users. Uber made the big announcement this week.
According to TechCrunch, a reliable source from the venture capital industry has described the deal as “definitely acquihire,” or more about talent acquisition. Acquihire refers to the process of acquiring a certain startup or company to recruit its employees, meaning the deal has nothing to do with current products or services.
This is all about acquiring people or talents.
The term acquihire is no longer new in the tech world. It has become increasingly common in today’s business world, especially in venture capital-backed startup companies. These are startup or companies that have received a significant amount of their funding from VC companies. Currently, Facebook leads the pack in the acquihire race, which reportedly made 12 acquisitions over the last five fiscal quarters.
Swipe Labs, the target company
Founded in 2014 and based in San Francisco, California, Swipe Labs develops a social product that allows users to share contents (photos and videos) of their friends that are not posted on the social networking site Facebook.
The company was backed by top-tier investors, which include Amasia, Binary Capital, First Round, Greylock Partners, Khosla Ventures, Lowercase Capital, Sherpa Capital and SV Angel.
Before the Uber deal, the company has already raised $8.2 million in two major funding rounds. The first one was in November 2013, with 6 investors on board.
The second one was on January 2015, with the backing of 4 investors.
Financial terms of the deal were not disclosed to the public, but according to TechCrunch which got the full details of the story, the deal valuation is almost surely much less than the $56 million valuations the startup has scored with its $5.6 million late-2014 Series A funding round.
Founders Marwan Roushdy and Addison Hardy have managed to grow Swipe’s user base to more than a million users in the first few weeks only, gaining lofty valuation and attracting VC companies.
Uber and its current position
The San Francisco-based company is currently in a tough position after it was struck by a scandal. CEO Travis Kalanick has just resigned amidst sexual discrimination scandals. However, the issues have not stopped Uber from making some strategic acquisitions in the market.
Analysts believe that the latest deal would be a big help for Uber. The company ’s monetization experience is currently undergoing a significant shift. The Swipe Labs could make it easier for drivers to make more money, providing some additional features to Uber’s ride-sharing apps.
Another big announcement
In another Uber-related story, the company has just announced that its ride-sharing service in Russia will merge with its much larger rival, Yandex. The deal, which reportedly valued at $3.7 billion, will give Uber 40 percent controlling stakes of the new business.
The merging of the two companies is the latest sign of the challenges that Uber has faced in working overseas. The company has been waging costly price wars against a more established local competitor. The deal with Yandex is expected to end the bloody and costly battle for Uber in the Russia market. And more importantly, the deal would strengthen Uber’s position in Russia and the Eastern Europe.
