Lyft And Uber To Offer Stock Options To Drivers Ahead Of IPOs

Lyft And Uber To Offer Stock Options To Drivers Ahead Of IPOs

Lyft booked revenue of $2.16 billion in 2018 and a loss of $911.3 million, according to its IPO filing. The company's largest shareholder is Rakuten Inc, a Japanese internet company that invested in Lyft in 2015 and made several subsequent investments, and owns a more than 13 percent stake.

Much bigger competitor Uber is expected to file for its own IPO later this month or next month. It posted a loss of $911 million for 2018, which climbed from $688 million in 2017 and $682 million in 2016, according to the filing.

Lyft applied to list shares on the Nasdaq Global Market under the symbol "LYFT".

In its filing with the U.S. Securities and Exchange Commission, Lyft released its financial history for the first time.

Lyft's drivers have earned a total of $10 billion since 2012, according to Friday's filing, and 91 per cent of them drive fewer than 20 hours per week. Lyft mentions it is a "visionary, founder-led company" and highlights its "Singular Focus on Transportation", a stark contrast to Uber, which has expanded its business to food delivery, freights and even on-demand staffing.

This is a controversial share structure often adopted by tech companies and will see a concentration of voting power among the company's founders, Logan Green and John Zimmer. Revenue had skyrocketed more than 200 per cent in 2017 compared to 2016, when the company brought in $343.3 million. Uber has been working to fix its image under CEO Dara Khosrowshahi, who tweeted congratulations to the Lyft team Friday, calling it "a big moment for ridesharing!" In addition to ride-hailing, it offers shared vehicle, bike and scooter rides.

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By being the first company in ride-hailing category to go public, Lyft is likely to attract institutional investors who want to get in on the sector, said Rohit Kulkarni, senior vice-president of research at Forge.

Lyft, which operates in the USA and Canada, was valued at just over $15 billion previous year. Its IPO could come as soon as early April.

In its risk assessments, Lyft outlined the difficulty of attracting and retaining drivers and riders "in a cost-effective manner", complying with laws and regulations, and being able to manage growth and expand beyond the US and part of Canada.

"We have incurred net losses each year since our inception and we may not be able to achieve or maintain profitability in the future", the company said. Revenue from Lyft's scooter business was also not material.

Lyft's US market share is approaching 40 percent, up from 35 percent in early 2018, people with knowledge of the matter have told Reuters. Serving only North America, the company's revenue mostly comes from ride-hailing and the company will seek to expand geographically and pursue acquisitions.

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