Roadblocks ahead for $40 billion Uber

By raising $1.2 billion of funding from venture capitalists most recently, the San Francisco-headquartered rideshare and taxi service Uber Technologies Inc. reached a theoretical value of $40 billion, bigger than Kraft Foods Group or American Airlines. Now available in 45 countries and more than 200 cities worldwide, the growth-exponential Uber is currently involved in a number of legal battles which look like as many roadblocks on the road for its development and for its chauffeurs. Taxi drivers, companies and unions have been protesting loud and clear against what it denounced as Uber’s “unfair business practices”. The protests have been successful so far in attracting governments’ and public’s attention, especially in Europe and Asia.

On the one hand, government officials seem to have reservations about Uber’s fiscal organization and legal status. On the other hand, most of the public, the very clientele of Uber, most often underlines the relevance of Uber compared to traditional taxis, citing competitive fares and better quality. Uber’s future IPO will mostly depend on its chances to overcome such a quick accumulation of difficulties. Like Tesla and other post-2010 fast-growing companies, Uber’s business model seems to be based primarily on its ability to communicate and interact with the media. However if one could have an accurate look at the figures and the legal issues, the same one may think twice about the $40 billion valuation.