By KAYLA FOSTER
Google’s parent company, Alphabet Inc., is making a $1 billion investment in Lyft; definitively ending their previous partnership with Uber after three years together.
In a blog post by Lyft, the company announced that Alphabet’s venture capital arm, CapitalG, was funding the investment, which Lyft projects to secure their position in going public by 2018.
While the ride-hailing service has been in deep conversation with many investment banks, so far none have been named as the company’s I.P.O. However, with CapitalG’s investment, Lyft’s new value of $11 billion, a major jump from last year’s $6.9 billion, may help the company reach its goal by 2018.
Lyft is still far from Uber, its biggest rival, which is valued around $70 billion. In the past, Alphabet had partnered with Uber through Google Ventures, which invested $258 million, as well as Alphabet’s chief legal officer David Drummond joining the Uber board. Google also gave Uber an “Uber tab” under their “Map tab.”
Relations took a turn for the worse after Waymo, Google’s self-driving car project, sued Uber after allegations came of Uber’s engineers stealing software and trade secrets. Uber has also had many internal disputations, which resulted in the former chief executive and co-founder Travis Kalanick leaving the company.
Lyft has certainly benefited from Uber’s missteps, and has since increased in 54 percent more Lyft drivers. Lyft also welcomed CapitalG’s partner David Lawee on as one of their board of directors, another ploy to help the company in its race to become public before Uber.
Multiple news media outlets have picked up the story; however, the investment is still new and will most likely go unnoticed until Waymo and Uber go to trial in early December. If Waymo wins, Uber may have to pay billions of dollars in damages and derail its efforts to build its own fleet of self-driving cars.