Uber-owned Careem spins out super app with $400M investment

Careem, a United Arab Emirates-based ride-hailing service owned by Uber, has secured a $400 million investment from e&, a UAE-based telecommunication provider formerly known as Etisalat.

In a letter to Careem staff published on its website, Careem co-founder and CEO Mudassir Sheikha said the investment will “turbo-charge” the company’s efforts to develop a super app.

“There is almost perfect alignment of vision, large overlap in geographic footprint and enormous demand synergies in their 162 million customer base,” Sheikha wrote.

“It is safe to say that we could not have found a more aligned and resourceful partner than e& to join us on this journey.” 

Careem launched in 2012 and became a wholly-owned subsidiary of Uber in January 2020 in a $3.1 billion acquisition.

Sheikha describes the new investment and strategy as “Chapter 3,” which involves splitting the company into two units: Careem Rides and Careem Technologies.

Careem Rides will continues to be fully owned by Uber and remain under Uber’s Rides leadership. Sheikha said the structure will enable the Careem Rides team to collaborate more closely with Uber on product enhancements to create an “unrivaled rides offering to power the rest of our super app.”

With the new investment, e& will own a majority stake in the spinout to be known as Careem Technologies, which will focus on developing and operating the super app that currently offers grocery delivery, digital payments, bike rentals, cleaning services and more. Sheikha said he will lead Careem Technologies as CEO.

“We will use the new funding and synergies with our new partner (e&) to scale the super app and build category-leading verticals in all our key markets,” Sheikha wrote in his letter.

Sheikha founded Careem along with co-founders Magnus Olsson and Abdulla Elyas. The company’s website says it now operates in more than 80 cities and 10 countries.