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Lyft got another $1 billion funding round by Alphabet’s CapitalG

Lyft got another $1 billion funding round by Alphabet’s CapitalG TimeOdd

Anonymous tipsters leaked word in September that Lyft Inc. may be looking to raise capital through an initial public offering scheduled for as early as 2018. Those plans have evidently been put on hold.

Lyft today announced the completion of a hefty $1 billion funding round led by CapitalG, Alphabet Inc.’s late-stage startup fund. The investment values the ride-hailing giant at $11 billion.

That represents a big increase from the $7.5 billion valuation Lyft was given after its last funding roundin April, but still puts it far behind Uber Technologies Inc. The latter company ranks as the largest privately held firm in the world, with a valuation of $68 billion. It’s a reflection of the balance of power in the ride-hailing market: Uber has served more than 5 billion rides so far, while Lyft only recently passed the 500 million mark.

The company will use the new funding to try to narrow the gap. No specific plans were divulged, but two recent updates may provide a clue as to the direction in which Lyft is headed.

Lyft got another $1 billion funding round by Alphabet’s CapitalG TimeOdd

The first is a September report that claimed the company, which currently only operates in the United States, has held a series of talks with London officials last year. Lyft executives apparently did not discuss the topic of an expansion explicitly but were said to express a “keen interest” in the city. Any attempt to move into international markets would likely be a rather costly endeavor for Lyft that the investment from Alphabet could potentially help foot.

The second clue that may shed some light on Lyft’s plans is the partnership that it struck in May with Waymo, Alphabet’s self-driving car division. Lyft followed up the move two months later by forming a division to develop autonomous driving technology in-house. The new funding could help the company step up its efforts and deepen the collaboration with Waymo.

Either way, Alphabet’s relationship with Lyft is shaping up to be much cozier than with its larger rival. The search giant led a $361 million round in Uber in 2013 but gave up its seat on the company’s board a year later because of their growing competition. The rift widened even further in February, when Waymo sued Uber for allegedly stealing autonomous driving technology.

The lawsuit came as part of a string of setbacks for Uber that more recently saw the company lose permission to operate in London. With the new funding, Lyft is in a much stronger position to capitalize on its rival’s missteps.

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Written by TimeOdd

TimeOdd is a leading technology media property, dedicated to obsessively profiling startups, reviewing new Internet products, and breaking tech news.


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