Published: Fri, March 29, 2019
Markets | By Otis Pena

Lyft valued at $24.3 billion in first ride-hailing IPO

Lyft valued at $24.3 billion in first ride-hailing IPO

Lyft was valued at US$15 billion in final private fundraising round in 2018. The price sets Lyft's market value at $24 billion, which will quickly change Friday after the shares start trading on the Nasdaq exchange.

The offering also fulfilled a key strategic goal for Lyft: beating larger rival Uber to the market. Uber is expected to make an even bigger splash when it completes its IPO later this year. It paves the way for other Silicon Valley companies seeking to float in the stock market this year, including Pinterest, Slack Technologies and Postmates.

Analyst Richard Windsor, who writes the tech blog Radio Free Mobile, argues that Lyft may not be ready for the scrutiny it will face as a publicly traded firm.

Orders for the IPO were oversubscribed last week, two days after the company opened its roadshow to investors, people familiar with the process said at the time.

Despite Lyft's recent inroad, there is still no guarantee the company will become profitable - a risk flagged in its own regulatory filings leading up to the IPO. The San Francisco company still hasn't turned a profit since co-founders Logan Green and John Zimmer started the service.

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Our revenue was $343.3 million, $1.1 billion and $2.2 billion in 2016, 2017 and 2018, respectively, representing year-over-year growth of 209% from 2016 to 2017 and 103% from 2017 to 2018.

Lyft revealed a loss of $911 million in 2018, which was 32 percent higher than the loss for 2017 of $688.3 million.

The underwriters for the offering are JPMorgan, Credit Suisse, Jefferies, UBS Investment Bank, Stifel, RBC Capital Markets, KeyBanc Capital Markets, Cowen, Raymond James, Canaccord Genuity, Evercore ISI, Piper Jaffray, JMP Securities, Wells Fargo Securities, KKR, Academy Securities, Blaylock Van, Penserra Securities, Siebert Cisneros Shank and Williams Capital Group.

Lyft will have a valuation of at least $20 billion with the initial public offering (IPO), one of the first from a wave of venture backed "unicorns", or startups worth more $1 billion or more.

The company didn't give any preference when allocating shares to potential shareholders who weren't investors in Uber, said a person familiar with the matter, who asked not to be identified because it wasn't public.

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