Popular ride-sharing service Lyft announced it has officially closed another round of funding.
It raised a fist-bump-worthy $250 million this time, which — if you're counting — puts Lyft on par with competitor Uber. (Via Lyft)
Uber received the same amount from Google Ventures back in 2013. Then the company was given a $3.5 billion valuation. (Via The Verge)
Lyft likely won't receive a valuation that high. Re/code reports, "Earlier in the round the pre-money valuation for Lyft had been $700 million."
The competition between the two companies is reportedly fueling this race for cash.
Lyft's co-founder wrote in a blog post Wednesday, "Since launching our second city one year ago, Lyft has grown to 30 cities across the country, and this investment will help us continue to grow in the United States and around the world."
For your scorecards, Uber is already in 35 countries and more than 70 cities.
One big potential target for Lyft — and one Uber has yet to crack — is New York City. Lyft CEO John Zimmer told Time: "There's a really entrenched existing industry with a lot of money tied up in the medallion system. But this is the year for Lyft in New York."
While Zimmer can't guarantee the Big Apple, the money will help Lyft reach more cities. Zimmer says Lyft has little overhead because they don't own the cars or employ the drivers.
"Lyft is your friend with a car."
That said, he told The Wall Street Journal it is still a "capital-intensive business."
Zimmer says advertising and other promotions are essential when Lyft launches in a new city.
A common promotion the service runs is $25 off your first Lyft. In some cities, Lyft was even trading free rides for driver feedback. Zimmer calls these promos "passenger acquisition costs."
The new round of investment was led by New York-based investment firm Coatue Management, which has invested in other high-profile tech companies Snapchat and Hotel Tonight.
Hedge fund Third Point and Chinese e-commerce giant Alibaba were also part of this most recent round. (Via The New York Times)
