Careem, a Middle Eastern ride-hailing company that Uber purchased in 2019, is spinning out its super app section into a separate startup with $400 million in funding from Emirates Telecommunications Group Corporation.
The largest telecom company in the United Arab Emirates, Emirates Telecommunications, now known as e&, declared that it had reached an agreement with Uber to buy a 50.03% stake in the startup Careem Technologies.
According to a post by Careem CEO and co-founder Mudassir Sheikha, the purchase will divide the company into two entities: Careem Rides and Careem Technologies.
The clear aim is to make it’s Super App unit the dominant business.
Careem Rides, which will be wholly owned by Uber, will employ 260 individuals and concentrate on its core ride-hailing product. Careem Rides will be led by Ashish Labroo, who will start reporting to Uber’s Rides leadership.
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Careem will operate the Super App
According to Sheikha, Careem Technologies would run the “Super App” in addition to all other verticals. The co-founders of e&, Uber, and Careem, Sheikha and Magnus Olsson, will all share ownership of this company. Sheikha will oversee this unit, which will employ roughly 1,400 people.
Since its founding in 2012 as a competitor to Uber in the ride-hailing industry, Careem has expanded its offerings to include food and parcel delivery, bus services, and credit transfers. As part of its strategy to diversify its operations, Careem has completed a number of acquisitions, including those of RoundMenu and Commut. In 2019, Uber paid $3.1 billion to acquire the ridesharing company Careem.
The most recent development demonstrates that the founders of Careem and the company’s most recent investor see the biggest promise in services that go way beyond ride-hailing. All of Careem’s services, such as food delivery, bike rentals, banking services that let users send and receive money, as well as third-party services such as cleaning, are consolidated into a single platform through the use of the Super app, which is currently accessible in 10 countries.
According to Sheikha, the newly acquired capital of $400 million will be utilized to “scale the super app and build category-leading verticals in all of our key markets.”
About Careem Technology
Mudassir Sheikha, a Pakistani American, and Magnus Olsson, a Swedish McKinsey consultant, launched Careem. It started as a website for corporate car bookings in July 2012 and became a ridesharing firm with daily car rentals.
Abdulla Elyas joined Careem in 2015 when the company bought a Saudi home service provider. In 2017, the corporation expanded maternity leave and hired more women.
As part of its goal to create one million jobs in the MENA region by 2018, Careem began operations in Palestine in June 2017. In January 2018, they launched Baghdad’s first ride-hailing service. The company has offices in Najaf and Erbil, Kurdistan Region.
RoundMenu, an Arab restaurant directory and food ordering platform, was bought by Careem in February 2018. Careem announced in August 2018 that they would begin bus service in Egypt in December. Early 2020 saw the service end.
In May 2019, Careem acquired UAE-based bike-sharing firm Cycle, which would become Careem Bike.
In April 2021, Careem launched Careem Pay, a UAE-based digital wallet for money transfers and withdrawals.
Careem discontinued food delivery in Pakistan in June 2022 due to economic constraints.