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The transport app is FlixMobility is given to Germany’s largest tech financing round to drive growth

FRANKFURT/MUNICH (Reuters) – Transportation-app-FlixMobility has been raised about 500 million euros ($561 million) in Germany’s largest tech financing rounds to date back to investments in the expansion, sources familiar with the matter said on Thursday.

Jochen Engert, the company’s founder and chief executive officer of the German mobility platform, FlixBus, which runs the buses and trains, poses for a photo in Grainau near Garmisch-enkirchen, Germany, July 18, 2019 at the latest. REUTERS/Michael Dalder

The Chief Executive and founder Jochen Engert declined to comment on the size of the investment, however, told Reuters that he would spend the money to launch the business in Asia and Latin America, and the construction of a car-pooling service.

Engert, the company has been established as a FlixBus, 2013, and the green long distance buses have been a familiar sight on the German autobahns, while the FlixTrains have to be aware of the European routes last year.

It is run by an Uber-like app to sell cheap tickets for the 100 million people, FlixMobility to work with local travel partners in 30 European countries, and has had a long-distance bus services in the United States last year.

The funding round is co-led by the private equity houses, TCV, and Permira, “it will put us in a position where we can really have the freedom to carry out our strategy and vision to build on Flix in a global mobility platform,” Engert said in an interview.

These values are Flixmobility to more than 2 billion euros, three sources said, as the classification of the company as a “unicorn” for a value of more than $1 billion. Revenue in addition to the $500 million raised from investors, led by japan’s Softbank (9984.T) is invested in the Berlin startup, GetYourGuide, earlier this year.

Existing investor Holtzbrinck Ventures has also participated in the so-called Series F funding round, together with the European investment bank. Earlier backers include General Atlantic, Silver Lake, and the car manufacturer Daimler ag (DAIGn.DE).

Morgan Stanley was the sole organizer of the fundraiser, according to two sources. He declined to comment.

THE WAY TO MAKE A PROFIT

FlixMobility hired advisers last year to look at an initial public offering, but in the end chose to work with investors who share a strategic vision, ” said the 37-year-old Engert.

The company does not publish financial statements, although it is already cost-effective in about half of the markets in which it operates, he added, will make it possible to finance growth in new markets, and break-even in general terms.

This stands in contrast to the decisions made by the AMERICAN-ride-coming companies, Uber (UBER.(N), and Lyft (LYFT.(O) to go public at a time when they are losing money, and, say some analysts, have no obvious path to profitability.

FlixBus, who will be competing in California with the veteran, Runs the brand has been launched in Texas and on the East Coast, as it seeks to achieve the market leadership in the United States of america, Engert said.

He wants to start bus services in the Latin America and Asia-pacific next year, as FlixTrain will be increasing Europe’s liberalised rail markets, are still dominated by state-owned operators.

Bolt-on acquisitions are likely as the FlixMobility want to support the growth in sales is running at about 50%.

Jochen Engert, the company’s founder and chief executive officer of the German mobility platform, FlixBus, which runs the buses and trains, poses for a photo in Grainau near Garmisch-enkirchen, Germany, July 18, 2019 at the latest. REUTERS/Michael Dalder

FlixMobility found out that a lot of the early adopters of the train had been traveling on a bus. Now it wants to take advantage of this “stickiness” with the introduction of a point-to-point car-pooling service, to be called the FlixCar, which is in direct competition with the French Blablacar.

“We’re seeing a lot of opportunities to create a more close-knit network in more places and destinations, not just in the big cities but also in small and medium-sized towns and cities,” said Engert.

“We see this as an add-on product to our main business. And it is sure to be a very attractive feature of the customer acquisition side.” FlixCar would like to start in one or two European countries, with details to be finalized this year.

Written by Douglas Busvine; Editing by Mark Potter

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