Lyft’s prospects just got bolstered post a $1 billion financing it received from Alphabet, the parent company of search giant Google. The investment was made via CapitalG, the growth investment fund of Alphabet.
The investment again isn’t something completely unexpected given that this was been actively speculated for the past few weeks already. The latest round of financing has brought the valuation of the car-sharing start-up to $11B.
Also, while Alphabet’s investment in Lyft does make sense considering the prospects that the sector poses, experts opine there could be more to it than just economics. It is no secret Alphabet also harbors dreams of running self-driving cars that could be put to use in the ride-sharing space.
In fact, Alphabet also has its own self-driving car program which has been positioned as a separate company named Waymo. It also is perhaps one of the longest running in the history of automobiles. Waymo and Lyft also aren’t complete strangers given that they had earlier announced plans to explore options to develop self-driving cars.
Lyft has even gone on to state such autonomous cars being the core of its future business plans, underscoring the importance that it accords to the hot new trend. Maybe Alphabet is looking for ways to test its own self-driving car tech developed over the decade in real life operating conditions.
Alphabet’s new found love for Lyft can also be seen as a subtle yet clear rebuff at Uber with which it has a dispute going. Waymo accuses one of its ex-employee Anthony Levandowski of stealing about 14,000 files when he left the company to set up his own self-driving truck start-up Otto. Uber later bought Otto and is hence drawn in the dispute between Waymo and Anthony Levandowski.
Meanwhile, tech rivals Apple too has made a similar investment in the Chinese ride-sharing company Didi Chuxing. Interestingly, Didi Chuxing is also into developing its own self-driving car tech, something that Apple is also believed to be working on as part of its secretive project Titan efforts even though its scope has since been downgraded to develop only the self-driving technology that other companies can adapt on to their vehicles rather than a complete futuristic automobile.