Alphabet could invest $1bn in Uber rival Lyft
The money, if a deal is agreed, could come from Google or from private equity arm CapitalG
San Francisco — Alphabet has held conversations with Lyft about a potential investment in recent weeks, signalling strong support for Uber Technologies’s main US competitor, according to people familiar with the matter.
An investment of about $1bn in Lyft may come from Google or CapitalG, Alphabet’s private equity arm, said some of the people, who asked not to be identified because the discussions are private. A deal may not come together.
Alphabet and Lyft declined to comment.
Alphabet is also an Uber shareholder through its GV venture capital arm, but Waymo, a unit of Alphabet, is suing Uber over self-driving car technology. As the relationship has deteriorated, Waymo signed a partnership with Lyft to work together on testing autonomous vehicles.
While Lyft has recently focused on controlling spending, the cash would allow the San Francisco-based startup to pursue more aggressive growth with subsidies for drivers, discounts for riders and marketing. Lyft kicked off a major television campaign this month that stars Jeff Bridges.
With an extra $1bn, Lyft would be able to ensure its independence for the near future, something co-founder John Zimmer has said is a priority. But some investors have suggested Alphabet would be a natural home for the ride-hailing startup. Lyft held informal talks with Alphabet and other potential acquirers last year but didn’t pursue a sale.
Lyft has gained market share this year as Uber has bent under a series of self-inflicted scandals. Uber faces at least three US probes and several high-profile lawsuits.
Dara Khosrowshahi, the former Expedia CEO, took over as Uber’s new chief last week.
He is looking to complete a fundraising deal of his own: Uber is advancing on an investment from SoftBank Group and others of as much as $12bn, most of which would allow existing shareholders to cash out.