Careem was co-founded by Mudassir Sheikha, a native of Karachi, Pakistan and Magnus Olsson, who had both worked as management consultants at McKinsey & Company. It started operating in July 2012 as a website-based service for corporate car bookings, and evolved to become a transportation network company with car hire for everyday use.
In 2015, the company acquired a Saudi-based home delivery service company and the founder, Dr. Abdulla Elyas, joined Careem. In 2017, the company announced a program to extend maternity leave and hire more women.
In June 2017 Careem launched operations in Palestine as part of a commitment to create one million jobs in the Middle East and North Africa region by the end of 2018. In January 2018 they became the first ride-hailing service to launch in Baghdad. The company also has locations in Najaf and Erbil, Iraqi Kurdistan.
It was announced in February, 2018 that Careem has acquired Round Menu, a restaurant listing and food ordering platform that operates across the Arab world. In August 2018 Careem said they would be launching bus services, starting with cities in Egypt.