Cross-Border Capital Markets Report
View our recently published articles in Newsweek, The Independent, CGTN, as well as our Managing Director Joshua Jahani on BBC (11:30).
Mobility technology is changing how we conduct business, travel, and even how we order food. Shared mobility investments increased by approximately 3,000% globally between 2013 and 2016. Shared mobility is limited to ridesharing and cab-hailing; it does not include public transport such as busses, planes, and trains. This report reviews the growth and anticipated future of shared mobility capital markets in the Middle East and across the world.
Sector Overview: Shared Mobility
Ridesharing and cab-hailing mobile applications are disrupting automobiles’ traditional value chain through fractional vehicle ownership. As global urbanization trends continue, J&A expects the shared mobility industry to continue reshaping the automotive sector.
The traditional global taxi industry will have to adapt to remain competitive with mobile aggregators. Taxi companies may attempt to undercut prices, but this reduces operating margins and could lead to inferior service quality. Implementing new technologies, such as mobile applications and customer relationship management systems, would be the best way for traditional taxis to remain competitive.
- Mobile aggregators facilitate the implementation of fractional vehicle ownership by creating on-demand access to transportation services.
- Most mobile aggregators, such as Uber, do not own the vehicles within their fleet and have been able to scale quickly without significant capital expenditure.
- Large mobile aggregators are vertically integrated into fleet and data management. Uber’s engineering and data department1 has deployed thousands of microservers to process the requests and data behind the millions of rides globally every day.
The Rise of Shared Mobility
FIGURE 2: Announced Deals 2010 – 2020
- Shared mobility capital markets were globally insignificant until 2013 when they experienced substantial investment growth. Capital deployed peaked in 2016 and 2018 with $28.54 billion and $29.78 billion, respectively.
- From 2010 to 2020, $113.38 billion was deployed across 253 companies within the global shared mobility sector. Over the period, 418 venture capital deals were conducted, with $61.88 billion in capital deployed. The average venture capital deal size was $148 million.
- System integration, data management, fleet management, and customer relations software are growing segments within shared mobility as traditional taxi operators transition towards mobile applications to remain competitive.
Shared Mobility Capital Markets and MENA-Based Companies
- MENA-based companies saw an increase in capital raised in shared mobility capital markets in 2020 despite the global decrease in capital deployment within the sector.
- The most active company in the MENA shared mobility market is Careem, which raised $774 million over eight rounds before being acquired by Uber on January 2, 2020, for an estimated $3 billion.
- Turkish companies Bitaksi Mobil Teknoloji and Olev, and Lebanese group Cabbis raised early-stage venture capital rounds between 2013 and 2020.