Lyft Is Said to Seek New Funding as Its Rival Uber Stumbles


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The ride-hailing service Lyft is talking with investors about new fund-raising that would put the company’s value around $6 billion, according to three people briefed on the financing.

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Josh Edelson/Associated Press for Lyft

Lyft, the second-largest ride hailing company in the United States, is trying to raise more money just as Uber, its bigger rival, grapples with questions about its culture and leadership.

Lyft is talking with investors about new fund-raising that would put the company’s value around $6 billion, according to three people briefed on the financing who asked to remain anonymous because the proceedings are confidential. One of the people said the valuation could be as high as $7 billion.

The company was valued at $5.5 billion early last year after investors, including General Motors, poured about $1 billion into it. It is unclear how far along Lyft is with the new fund-raising and whether the round will be completed.

Lyft, which is based in San Francisco, declined to comment. The funding effort was earlier reported by The Wall Street Journal.

The fund-raising may bolster Lyft competitively, given that Uber has been caught up in an escalating series of internal problems.

Travis Kalanick, Uber’s chief executive, has been under scrutiny this year for his participation in an economic advisory council for President Trump amid a social media campaign for people to delete their Uber app. Mr. Kalanick eventually stepped down from the council.

Uber has also wrestled with concerns about its workplace culture over the past few weeks, after a former employee published an account of her year at the company, which included allegations of sexual harassment and discrimination.

In addition, Uber was caught misleading journalists about an accident caused by one of its self-driving cars. And Waymo, the self-driving car business spun out of Google’s parent company, Alphabet, sued Uber last week, claiming it had used technology stolen by one of its employees.

This week, Mr. Kalanick apologized for his behavior toward an Uber driver after a video of him losing his temper with the driver surfaced.

Lyft has long been the underdog to Uber. Lyft operates only in the United States while Uber is a global company. The two have previously engaged in pricing wars and have bad-mouthed each other. In August, Lyft held discussions with General Motors, Apple, Google, Amazon, Uber and Didi Chuxing about selling itself. The company could not agree with potential buyers on a price.

Yet Lyft’s brand has recently looked comparatively attractive. As Uber struggled with its ties to President Trump’s administration in January, Lyft donated $1 million to the American Civil Liberties Union. Lyft’s app subsequently soared to the top of the Apple app store’s download list.

Neither Lyft nor Uber has emerged as a financially sound business. Their battle has led them to lower prices and offer deals to lure new customers and maintain their market share. It has been hard for either company to raise prices enough to cover costs. Both Lyft and Uber are still unprofitable and depend on private investment capital to fund their operations.

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