Ride-hailing company Lyft has raised $1 billion in a new round of funding led by Google's CapitalG, the tech giant's growth-focused investment fund. David Lawee, a partner at CapitalG, will join Lyft's board. But the technobromance first began to bud back in May, when Alphabet's autonomous vehicle development company Waymo partnered with Lyft, which gave Waymo a major boost in its effort to catch up with Uber-its main rival in the self-driving auto wars.
The influx of capital has the potential to further boost Lyft's momentum in the US while Uber tries to recover from a year full of PR crises, executive changes and legal scrutiny. The deal brings Lyft and Alphabet closer together in order to tackle their main rival, Uber, which is now weathering a bit of a storm due to various scandals.
Lyft had raised $600 million at a $7.5 billion valuation in April this year.
- Alphabet has ties to larger Lyft rival Uber Technologies through its second investment arm, GV. Alphabetsued Uber for stealing its autonomous vehicle trade secrets in a highly publicized case set to go to court in December.
Uber, by comparison, was last valued at $70 billion.
"Ridesharing is still in its early days and we look forward to seeing Lyft continue its impressive growth", Lawee said in a statement. Uber began heavily recruiting Google employees for a number of divisions within the company and Google chief legal officer David Drummondstepped down from Uber's board past year as the two companies began racing to develop autonomous auto technology. Ride-hailing supremacy in the U.S.is still up for grabs, with Alphabet placing its latest bet on Lyft, while SoftBank backs Uber.
Lyft is close to hiring an initial public offering (IPO) advisory firm, the first concrete step by the company to become publicly listed.
Interestingly enough, CapitalG is also an early investor in Uber.
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