Going one step ahead of its ride-hailing competitor Uber, Lyft has started preparing for its first public offering in 2018. It is making its position strong by raising more capital. This includes the $1 billion that was raised in a recent funding round led by an investment company that is part of Alphabet Inc.
Lyft has already undergone a series of discussions with investment-banking companies, sharing its plans to go public in 2018. However, Lyft has not confirmed which bank will be the primary underwriter for its IPO.
The additional funding from Alphabet has bolstered its valuation to $10 billion, which is a huge jump compared to its previous valuation of $6.9 billion. The funding has also created a complex web of financial investment, with companies like Lyft and Uber raising large amounts of funds from investors who are placing their bet on rival companies.
However, with Alphabet Inc. on its investor list, the competitive edge has swung to Lyft. As an outcome of the deal, David Lawee, a venture partner at Capital G, the investing arm of Alphabet Inc., will be sitting in the board of directors at Lyft.
Speaking on this occasion, John Zimmer, president of Lyft, said, “This creates a huge opportunity to best serve our cities’ economic, environmental and social futures.”
Lyft’s rival, Uber, has been a strong force in the market, but with recent set of scandals hitting the ride-hailing company, investors were forced to make some serious decisions, such as kicking out Co-Founder Travis Kalanick. The damage of such scandals has helped Lyft gain popularity and enhance its own profile. Investors are trying to position themselves to get the best returns by investing in rival ventures, even though that strategy creates a complex allegiance.