In its market debut, Lyft counters Uber with 'nice guy' image
- Author: David Armstrong Mar 31, 2019,
Mar 31, 2019, 4:29
Lyft exceeded market expectations with its initial public offering (IPO) on Thursday, raising $2.34 billion and fetching a valuation of $24 billion. Lyft ended up settling on the maximum figure of $72 when trading began on the Nasdaq.
Although the company reported a 2018 net loss of almost a billion dollars, investors clamored for a piece of the Lyft IPO, with underwriters reporting demand for the stock that was 20 times larger than the shares available, the Wall Street Journal said.
After a few minutes of trading, shares were up 18.6 percent at $85.42.
The Nasdaq listing button on speakers podium is covered in pink confetti after Lyft listed on the Nasdaq at an IPO event in Los Angeles, Calif. on March 29, 2019.
Still, Lyft's path to profitability is uncertain, and it's under pressure to keep prices low as it competes for customers with Uber and traditional taxi companies.
"Both companies are vying to become the "mainstream verb" for ride-share at the moment", à la Google being synonymous with online searching, Blankenship said. The no. 2 USA ride-hailing company said in a statement that it priced 32.5 million shares on Thursday at $72 each, which was at the top of the marketed range. Lyft co-founders Logan Green and John Zimmer were also joined by some of the comnpany's drivers on Friday morning. Expect plenty of drama, from insane highs to deep disappointments, and all kinds of craziness in between featuring some of Silicon Valley's biggest unicorns such as Uber, Slack, Postmates, and Pinterest.
This month, Lyft disclosed in its IPO filing with the Securities and Exchange Commission that it lost $911 million on revenue of $2.2 billion in 2018. "And now, after more than 1 billion rides, we're able to look forward to a world we've long imagined, designed less for cars and more for people".
"Lyft is shooting itself in the foot by going public, as I continue to think that the company is not ready for the harsh glare of the public market and it is giving away a big edge that it could have had over Uber", Windsor writes.
The Detroit automaker invested $500 million in Lyft in 2016.
Lyft raised $2.34 billion its IPO.
The lead bankers for the offering - JPMorgan Chase & Co., Credit Suisse Group AG and Jefferies Financial Group Inc. - presented over nine days to more than 600 investors, said a person familiar with the matter who asked not to be identified because the meetings were private. Lyft's net loss climbed to $911 million in 2018, which is more than any other U.S. startup has lost in the year prior to its IPO. Uber is expected to publicly file for its offering in April, kicking off a listing that could value it at as much as $120 billion, people familiar with its plans have said.