There's major investment news for taxi-hailing apps in China, but for once it doesn't concern Uber or the US company's well-backed Chinese rival Didi Kuaidi. Yidao Yongche, a three-year-old private car service, has received an investment that values its business at the magic $1 billion mark.
LeTV - an ambitious Chinese company that sells smartphones, runs a growing video site, and holds other business interests - announced today that it has bought a 70 percent stake in Yidao Yongche. LeTV said the investment is undisclosed, but the taxi firm confirmed to TechCrunch that the amount is $700 million - which puts it in the billion dollar unicorn bracket.
That's a pretty impressive valuation for a company that analyst reports estimate holds anything between 0.7 percent and 2.7 percent of the domestic ride sharing market. The billion dollar valuation is testament to the potential that investors see in the taxi market in China - a country that Uber, for one, predicts will surpass its U.S. business soon - and likewise the size of LeTV's ambitions.
LeTV is probably best known in China for its Xiaomi-like affordable Android phones and its video site which is challenging Youku Tudou, the dominant player which Alibaba is bidding to buy for $3.8 billion.
But LeTV is also hard at work on robotics and cars. The company recently partnered with Aston Marin and BAIC to develop electric cars, and it claims to have invested in a range of businesses that cover the automobile space, including R&D, sales, charging and more.
Becoming a majority shareholder in Yidao Yongche adds another component to its automotive move, a company spokesperson told TechCrunch.
Yidao Yongche, which was previously linked with an investment from Uber that never materialized, is an interesting player in China's ride-hailing space. While financially outgunned by Didi Kuaidi, the $15 billion valued company that recently raised $3 billion, and Uber, which raised $1.2 billion for its China business and is a planning a huge expansion in the country, it has carved a niche for providing Uber Black-like private cars. That extends to overseas markets, too. Yidao Yongche is present in over 20 cities across the U.S. and other countries where it caters to the burgeoning number of Chinese tourists.
"Most Chinese don't speak English and find it difficult to communicate with foreign drivers after they land in another country. We have Chinese-speaking drivers in the U.S. and other places to make it seamless and stress-free," founder and CEO Zhou Hang told China Daily earlier this summer.
This article by Jon Russell originally ran on TechCrunch, a leading technology media property, dedicated to obsessively profiling startups, reviewing new Internet products, and breaking tech news.