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Tech40 Under 40

Why Apple, Disney, Ford, GM, and PepsiCo All Stand to Benefit From a Lyft IPO

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September 28, 2017, 10:36 AM ET
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An initial public offering by Lyft, the second largest U.S. ride services firm, could benefit a broad and diverse group of investors, from Chinese tech giants Alibaba and Tencent to a member of the Saudi royal family.

Lyft is close to hiring an initial public offering (IPO) advisory firm, in the first concrete step by the second biggest U.S. ride service company to become publicly listed, according to people familiar with the matter.

U.S. automaker General Motors (GM) is one likely beneficiary.

Since it was founded as Zimride in 2007, Lyft has raised more than $2.6 billion from more than 40 venture and corporate investors, the most prominent being Detroit-based GM, which acquired a 9% stake in early 2016 for $500 million.

Ford Motor (F) Executive Chairman Bill Ford, whose company on Wednesday announced a partnership with Lyft, holds a financial stake though his private venture capital firm Fontinalis Partners.

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Other high-profile investors include Carl Icahn, Henry Kravis, and Saudi Prince Alwaleed Bin Talal, whose Kingdom Holding has stakes in Apple (AAPL), Citigroup (C), Walt Disney (DIS), and PepsiCo (PEP).

Edinburgh-based investment bank Baillie Gifford, a significant shareholder in Tesla (TSLA), also has a stake in Lyft as well as in Indian ride services company Ola.

Alibaba (BABA) and Tencent (TCEHY) are both investors in China’s largest ride services startup, Didi Chuxing, which in turn is an investor in Lyft and Ola, as well as in Uber Technologies, the largest U.S. ride services startup.

Tencent has invested aggressively in the transportation sector, acquiring a 5% stake this year in Tesla for $1.8 billion. Tencent also is a shareholder in two Silicon Valley self-driving startups, Zoox and Nio.

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