Thursday 27 October 2016
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Uber Rival Lyft Gets $100 Million Dollar Lift        

Uber Rival Lyft Gets $100 Million Dollar Lift        

Lyft, the popular San Francisco-based ride-sharing service that operates in 65 U.S. cities nationwide, is sitting on a new pile of cash this week. Friday, activist investor Carl Icahn tossed $100 million into the company’s coffers in the latest round of fundraising, which produced a total of $150 million in total. The company was recently valued at $2.5 billion.

“We are very happy to be investing in Lyft,” Icahn said in a statement. “I believe that ride-sharing is poised to become a fundamental component of our transportation infrastructure. The company’s revenue growth to date has been extremely compelling, and increasing urbanization over the next 5 to 10 years should enable the company to maintain that trajectory. Additionally, I’ve been very impressed with Lyft’s founders and management team, and I believe they are well-suited to take advantage of this opportunity and to make Lyft an extremely successful company.”

As part of the investment, one of Icahn’s managing directors, Jonathan Christodoro, will join Lyft’s board of directors. Icahn owns stakes in Apple, Yahoo, Netflix, Hertz, Gannett and eBay, among many other publicly traded companies. Last month, Lyft added marketing and communications executives from Nike and Facebook.

In May, Lyft also announced a national partnership with Verizon. Starting this week, Lyft drivers on the Verizon Network can receive discounts on their monthly bill, family plans, and accessories through Lyft’s premier driver rewards program.

The company was once known for its big fuzzy pink mustaches attached to the grilles of its drivers’ cars, but this year it ditched the facial feature for smaller, light-up “glowstaches” which sit on the interior of Lyft cars.

Lyft’s rival, Uber, operates in 58 countries and is valued at $40 billion.  Earlier this year, Uber offered a delivery service, and it has experimented with package and grocery delivery.

The rivals compete heavily for both drivers and riders everywhere they operate, and not without some mud-slinging. CNNMoney reported last year that Uber drivers called and canceled thousands of Lyft rides in a modern version of “ding-dong ditch.” Uber accuses Lyft drivers of doing the same. Both Lyft and Uber users are subject to increased prices during peak driving times, which can, in some cases, double or triple normal rates.

Meanwhile, both companies are battling legal issues in many states and cities. Many officials say the two outfits are operating illegally, since their drivers don’t have the proper licenses required of all vehicle-for-hire drivers. In once case, after coming under fire in Detroit last spring, both companies struck agreements to continue operating in Detroit by requiring drivers to be insured and to undergo vehicle inspections.

Photo Credit: Lyft