What Will Become of Lyft? Uber's Rival Is Worth Less than $5 Billion. Will Anyone Buy It?
Last year, private equity firms kicked the tires on Lyft, a source tells me. I take a look at the M&A market through the eyes of a fallen ride sharing company.
I remember staking out Lyft’s IPO roadshow at Manhattan’s St. Regis Hotel where a glass of orange juice cost $15. Uber hadn’t gone public so Lyft became the test case for the ride sharing industry and for startup IPOs. Lyft’s founders John Zimmer and Logan Green dipped in and out of black SUVs as they courted the world’s largest investment firms.
If only we’d known then that that would probably be the most the world ever cared about Lyft.
As we begin 2023, mergers and acquisitions are this year’s Chekhov’s Gun. The IPO market is frozen. Once high-flying tech stocks have fallen. Investors are wondering if any tech giants or private equity firms will have the courage to stick their necks out and scoop up a deal. I thought I’d look at Lyft’s prospects as a proxy for the broader M&A market to draw out some of the contradictions of the present moment in corporate finance.
I’ve learned that in the second half of last year several private equity firms considered purchasing Lyft. They kicked the tires on the company but decided not to buy the company.
Lyft would be a natural platform to deploy a self-driving car network. Or it could be the other half to DoorDash’s competition with Uber.
But it’s very possible no one swoops in to buy Lyft on the cheap.