Uber finally got its secondary transaction done with SoftBank buying about $8 billion worth of shares last month. Now we’re learning more about who sold what.
It was already known that major shareholder Menlo Ventures was looking to sell shares, but we’re hearing confirmation that it wagered the majority of its holdings and successfully sold close to half of its stake, which the Information reported was about 4%. Using this ownership percentage, we calculated that Menlo netted close to $1 billion from the transaction.
We’ve also learned that First Round Capital attempted to sell most of its shares and successfully sold close to 40% of them. They were also said to own 4% of the company, which would mean it cashed out $800 million.
Benchmark Capital gave up a sizeable stake as well. According to a report from Recode, the venture capital firm sold about $900 million in Uber shares in the secondary transaction or almost 15% of its 13% stake. Benchmark declined to comment.
Former CEO Travis Kalanick also sold 29% of his holdings, earning him $1.4 billion. He stepped down from his role in June, but remains on Uber’s board. Benchmark Capital is also dropping its lawsuit against him, after promising to do so if the SoftBank transaction got done.
The deal was significantly oversubscribed, meaning that sellers were only able to sell about 58% of what they attempted. This is despite the secondary transaction valuing Uber at roughly $50 billion, well beneath the close to $70 billion private market valuation in Uber’s last private round. Even though an IPO is said to be less than two years out, Uber shareholders must have been uncertain that the company would achieve a $70 billion market cap or even a $50 billion market cap on the stock market.
Uber has a fast-growing business, but has faced lawsuit after lawsuit, and regulatory obstacles throughout the world. There’s also been a public outcry about its company culture.
But not everyone opted to sell their stake. We’re hearing that Kleiner Perkins kept its Uber shares.
And it wasn’t just venture capitalists and founders selling positions, the transaction gave early Uber shareholders an opportunity to sell as well. For many employees, this was the first opportunity to turn their paper riches into cash.
In addition to the secondary transaction, SoftBank also invested $1.25 billion directly in Uber. This was at the previous valuation of close to $70 billion.