Softbank, the Japanese technology and media giant, is considering a multi-billion-dollar investment in the world’s largest ride sharing firm Uber for a minority share in the most valued startup. The development comes at a time when the firm is going through a leadership change after the exit of Travis Kalanick. Softbank has been investing in Uber rivals across the world. It holds a position in Ola, the dominant ride-hailing company in India, which is locked in a battle with Uber across the country; Didi Chuxing, which until last year was deadlocked with Uber for supremacy in China’s transportation market; Grab, a Singaporean ride-hailing company, competing with Uber in South Asia region.
The Uber investment proposal indicates that Softbank is hedging its bets by investing in the dominant player as well as the minor ones. With the ride sharing industry facing cost hurdles, it is prudent for the Japanese firm to avoid getting in a position with 1-2 of its portfolio companies defaulting due to the pressure. Uber has been one of the companies that drove the cutthroat competition in the ride-hailing industry, by spending heavily and slashing costs for passengers. But that has begun to change in recent months as the company has dealt with turmoil in its executive suite.