Estonia’s Bolt, one of Uber’s biggest competitors in the European ride-hailing market, has raised €50m (£42.5m) from the European Investment Bank (EIB).
The funding comes in the form of a venture debt facility, which combines the advantages of a long-term loan with repayment terms tied to the company’s performance.
The EIB said on Thursday that the funding would support product development and research in areas where technology can improve the safety, reliability, and sustainability of its services.
This includes investments in ride-hailing and food delivery, the EIB noted.
Bolt, formerly known as Taxify, was valued at over $1bn in a funding round in 2019.
The ride-hailing start-up is near identical to Uber (UBER) in function. But while Uber has raised tens of billions since it was founded in 2009, Thursday’s haul from the European Investment Bank brings Bolt’s total raise to around $250m.
The firm’s founder and CEO, Markus Villig, has previously extolled the benefits of raising less money, noting that it helped his firm focus on growing sustainably.
Uber’s lavish bankrolling, on the other hand, has created a “bloated” company with “a culture where nobody cares about costs,” Villig said.
Villig, 25, founded Bolt in his native Estonia in 2013, when he was just 19.
While Bolt has not given away any equity to the EIB, the financial return of the loan for the bank will be calculated as a percentage of the start-up’s future revenue streams.
Bolt launched in London last June. The EIB said on Thursday that the company is now profitable in approximately two-thirds of its global markets, calling it “Europe’s leading on-demand transportation platform.”
It said it was the fastest-growing transportation platform in Europe and Africa, noting that it has over 30 million users across 150 cities.
In London, Bolt’s user base reached 1.5 million customers in six months, it said.
The company is hoping to capitalise on Transport for London’s ban of Uber operating in the city. Uber is appealing the ban.