After raising $300 million from Volkswagen earlier this year, on-demand ride service Gett is getting another tranche of financing. On Wednesday, the company announced that it has secured a $100 million, seven-year loan facility from Russia’s Sberbank. Gett said that it will use this to further expand the service with the bank — one of its big corporate customers — as well more general business expansion.
“Sberbank and Gett have a long-standing partnership,” said Shahar Waiser, Gett Founder and CEO, in a statement. “Both companies have a similar vision – to change peoples’ lives through technology and innovation. For more than a year, Gett has delivered exclusive benefits to Sberbank customers and employees, a service that is already available in 57 Russian cities. This loan agreement will further strengthen our partnership, support Gett’s rapid growth, and help us achieve our ambitious goals.”
Gett — which has operations in 100 cities — trails far behind the likes of Uber in terms of global footprint, revenues and funds raised, but it is hoping to bring something new to the mix where it doesn’t have to play by Uber’s rules.
This includes its strategic partnership with VW, the world’s biggest car maker, to work on the latter company’s bigger push into the Next Big Thing in automotive, but also how Gett positions itself in the market, catering more to business users than consumers and building a platform to bring together more established car firms and ride providers, rather than a focus on the idea of ‘anyone’ becoming a driver.
For Sberbank, the loan represents the financial group’s first investment into the area of ride sharing and on-demand startups. Uber last year reportedly secured a $2 billion credit line with banks, believed at the time to be part of the large transportation startup’s increasing relationship with them, ahead of a potential IPO. Banks in the transaction reportedly included Bank of America, Barclays, Citigroup, Deutsche Bank, Goldman Sachs, HSBC, J.P. Morgan Chase and SunTrust .
Sberbank is also keen to get involved in the later stages of these potentially large businesses, so it’s worth keeping an eye on it to see whether more investments elsewhere follow.
“This is the start of an exciting new phase for Sberbank CIB where we will be working closely with entrepreneurs like Mr. Waiser to finance the most dynamic companies and become their partners at a relatively early stage in development,” said Oscar Ratsin, VP and head of Sberbank Merchant Banking & Advisory, in a statement. “With this transaction, we are announcing that our Merchant Banking & Advisory Department is open for business with rapidly growing tech companies who may not yet have access to traditional bank financing, where venture loans can be an attractive solution.”
Gett has raised $622 million to date including this loan. It’s been reported that Gett was looking for funding at a valuation of as much as $2 billion earlier this year.