A lot of things will have to work in Uber's favor over the next several years to justify a reported $50 billion valuation, venture capitalist Steve Brotman said Monday.
"At 120 times forward revenue, investors are paying a few years up for value. A lot of things are going to have to go right for the next two, three, four, maybe five years," the managing partner of Alpha Venture Partners said in an interview with CNBC's "Closing Bell."
The ride-hailing start-up plans to raise between $1.5 billion and $2 billion in new funding, bringing its valuation to at least $50 billion, according to The Wall Street Journal.
Brotman noted that Uber is not just a limo company and has the opportunity to really disrupt the auto industry.
"Our economy is about 10 percent automotive driven. If we reduce the need for cars by 20, 30 percent, we're talking about trillions of dollars in value migrating to a firm like Uber," he said.
Walter Isaacson, president and CEO of The Aspen Institute, believes the company is transforming not only the taxi industry but the way people work and the way cities operate.
"You're talking about a trillions dollars that's going to move away from an automotive-based economy to one in which people get things on demand," said Isaacson, also a CNBC contributor, on "Closing Bell."
"I find Uber to be the most transformative concept in ... our daily economics in the past five or six years, so I think it's huge."
He also thinks it is fine for the company to stay private, despite its size.
"It keeps you from being regulated."