Ride-hailing firm Lyft’s value jumps to US$15.1 billion in new funding round

Ride-hailing service provider Lyft received a vote of confidence from investors in the form of a US$600 million funding round and a markedly higher share price.

Led by existing backer Fidelity Management & Research Company, the new financing round boosted Lyft’s valuation to US$15.1 billion, a company spokeswoman said on Wednesday.

That valuation is slightly more than double the US$7.5 billion figure used when the San Francisco-based company raised US$500 million early last year, when it was gaining ground on rival Uber Technologies.

Fidelity injected more into Lyft after investing late last year in a deal led by Alphabet’s private-equity arm CapitalG that valued the business at US$11.5 billion. Senator Investment Group, a hedge fund, took part in the new round, Lyft said.

Lyft president: It’s ‘incredibly important’ for companies to do privacy right

The latest funding has made Fidelity one of Lyft’s largest investors, with US$800 million in investment. Other investors in Lyft, which has a 35 per cent market share in the United States, include AllianceBernstein, Baillie Gifford and KKR & Co.

Lyft, which became known for the large pink furry moustaches drivers attached to the front of their cars, has seen its valuation and business grow in the aftermath of scandals that vexed ride-share market giant Uber.

The two ride-hailing companies are among the richest of the Silicon Valley “unicorns”, or venture-backed start-ups valued at more than US$1 billion which have not yet hit the stock market.

Lyft, which has been focused mainly in the US, recently expanded to Toronto and other cities in the Canadian province of Ontario.

Most Lyft rides will be in autonomous cars in five years, founder predicts

While Uber has said it plans to go public next year, Lyft has been more circumspect about its intentions. The new investment would give Lyft a bit more latitude to control the timing of a public offering.

Still, Uber said in May it would hold a secondary stock sale for employees and existing investors that would value the company at US$62 billion, up from the US$48 billion valuation it commanded in a secondary sale late last year.

Uber operates across the globe, although it has retreated from Southeast Asia, Russia and China after losing billions of dollars competing with local rivals.

With reporting by Bloomberg, Agence France-Presse and Reuters