They didn't, though. They closed their Series A in Feb 2011. They got their first cease & desist in October 2010 [2], 4 days after closing angel financing. [3]

IMHO, the key success factor for Uber is their ability to spin every setback into an advantage. So, the fact that they were sued for operating like a taxi cab company means that the taxi cab industry views them as a threat. They could then take this to investors and say "We're about to disrupt a $16B market. The market opportunity is there, and the lawsuit against us is proof of that. The product is there. People are choosing our product over the competition. We need your help to roll back protectionist legislation that is hurting consumers. Are you in?"

And then many investors won't be, but they just keep trying new ones until they find folks who buy in.

[1] https://www.crunchbase.com/organization/uber/funding-rounds

[2] http://techcrunch.com/gallery/a-brief-history-of-uber/slide/...

[3] http://techcrunch.com/2010/10/15/ubercab-closes-uber-angel-r...

> Uber came out of the gate with war chests from investors

How the hell did Uber manage to convince investors to fund them so before they showed success?

There's nothing really technically special about Uber so I doubt that investors were lured by the strength of the proposal or anything like that. The founder of StumbleUpon was a co-founder, so it was most likely through his connections + track record, but I don't actually know the details (someone else here might). I would guess that it's just an accident of luck that Uber became Uber -- right time, right place, and right connections. That's what it takes to get a business off the ground, especially a business that raised $1.5 million in funding before it was released (per Wikipedia's timeline).

Kalanick's previous company Red Swoosh sold for $19m. They were probably backing him as much as anything.