"RyanAir for the road." "Hitchhiking for the 21st century." Whatever it is, investors see opportunity in long-haul ride-sharing—and France's BlaBlaCar is leading the way.
In July 2014, a French ride-sharing company called BlaBlaCar caught the attention of the U.S. tech press by raising $100 million from several high-profile industry investors including Index Ventures and Accel Partners. In a crowded field, the nine-year-old company distinguished itself by focusing on the long-haul ride. Think of it like a RyanAir for the road.
This month, the company is at it again. TechCrunch reports that BlaBlaCar has raised even more money, to the tune of $160 million, from investors such as Insight Venture Partners “at a post-money valuation of $1.2 billion.” If it’s true, that will make it the 140th entry on Fortune’s rapidly expanding Unicorn List.
It also makes for an interesting data point in the growing on-demand transportation sector. In the U.S., many of the original “ride-sharing” companies have gravitated toward the more on-demand approach popularized by leader Uber and away from the shared-ride concept popularized by rival Lyft. It’s a cultural issue: What may work in friendly San Francisco (fist-bumps with your driver) may not fly in cosmopolitan New York.
But Europe and its patchwork of cultures is altogether different than those two American cities. (Which may be why companies like Gett are better known on the Continent and less known Stateside.) BlaBlaCar, present in 17 countries worldwide thanks to a handful of acquisitions, offers to connect a person who is driving from one city to another, and has empty seats in his or her vehicle, with a potential passenger. It’s like hitchhiking for the 21st century.
How that plays out in each respective market will be interesting. In France, the company markets its services as cheaper than a train; a two-hour trip from Paris to Lyon costs just 22 euros, versus 29-75 euros (SNCF train) or 403 euros (plane). France is a country that has a strong, fast regional rail network. So is Germany. Key corridors aside, the United States is not. Nor is India.
For that reason, BlaBlaCar seems to have its sights set outside the U.S. The good news is that intercity transportation typically comes with fewer regulations than inner-city transport. The big question is whether there is enough regional road traffic—and welcoming drivers—to support the company’s ambitions.
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