David Krane describes his investment in Uber as the “relentless pursuit of a guy that’s hard to pin down.”
In the early days of Uber, back when it was still a black car service, Krane realised he was using the company with great loyalty and great frequency — traits he looks for when making news investments. So, he set out to track down Travis Kalanick, Uber’s CEO and cofounder, and spent two years working on building a relationship with him.
“Thankfully the company’s capital needs opened up long before I lost my patience and ran out of enthusiasm for chasing him, so it worked out beautifully,” Krane, a managing partner at GV (formerly known as Google Ventures) told Business Insider.
Except Kalanick wanted something very unusual at the time: He wanted one single investor to fund the entire round.
“And he wasn’t looking for $10 million, he was looking for way more than that,” Krane said.
The amount Kalanick wanted was around $250 million, and Krane had to convince his partners at GV that Uber was worth the price and the risk to the fund.
“By simply running that analysis about sticking a quarter of a million into one company, it is totally unconventional. It’s such a concentrated piece of exposure,” Krane said.
But having worked for Google since 2000, Krane preaches that you can’t resign yourself to accepting what’s known and old. That company is all about moonshots and experiments. And when Krane looked at Uber’s numbers, he found himself looking at a company that was on the same path as the early days of Google.
In his seven years of venture capital investing, he says he’s never seen any other company with growth charts like it.
“Uber and Google share so much in common from that perspective, it’s just amazing. It was like looking in a mirror,” Krane said. “We knew how the story of Google played out and it gave us further confidence that the story of Uber would be the same.”
GV went on to lead the 2013 Series C round for Uber, meeting the price that Kalanick wanted (although two other investors also participated to bring the round’s total funding to $361 million). Since then, Krane’s enthusiasm for the company is undeniable and has only grown. Even GV’s big risk now pails to Uber’s most recent $3.5 billion round from the Saudi Arabia’s sovereign wealth fund.
“The company hasn’t been without tension. It’s had extreme amounts of scrutiny, frankly more scrutiny than I think a company of its age should have or even deserve to have. Has it facilitated some of that attention? Absolutely. Is it deserving of all the scrutiny it gets? Absolutely not,” Krane said. “This company is growing like no other.”
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