…and they beat Uber to it. Just like they wanted to.
News just broke that Lyft has taken the first step towards going public by filing confidential documents with the SEC for an IPO.
Valued at $15B, Lyft didn’t reveal shares it expects to offer, nor a price range. But Lyft did say the IPO will happen as soon as the SEC finishes its review process.
According to sources, that could be as early as Q1 next year, depending on how quickly the SEC reviews its filing. Lyft’s valuation is likely to end up between $20B and $30B, one source told Reuters.
By going public first, Lyft—whose JP Morgan/Credit Suisse and Jefferies all-star banking team will underwrite the IPO—gets a big win over its chief rival Uber.
According to rumors, Lyft CEO Logan Green was caught dancing in a local Silicon Valley bar like…
These are just rumors at this stage, however.
Now we wait for Uber…
Expect Lyft’s IPO to generate massive hype, all the while setting the stage for Uber to join Lyft on Wall Street.
Two of the most hyped unicorns, Lyft and Uber have become insanely popular investment targets, even though neither have yet to turn a profit. (Unprofitable IPOs has been par for the course in 2018; nothing special there.)
As it stands now, UberEats alone is valued higher than Lyft’s $15B. Lyft will want to change that, especially as its private investors seek to score big exit bags. The $20B to $30B IPO target will accomplish just that.
Just for reference, Uber recently got a reported $76B valuation on the private markets. But according to reports, Uber’s looking for a $120B valuation on the public markets.
Still the most valuable startup in the world, Uber brass says their IPO will ultimately end car ownership.
So why did Lyft want to go to the public markets first, just for petty bragging rights?
That’s probably some of it.
But more importantly, by IPO’ing first, Lyft gains the “first-mover advantage” over Uber.
Plus, Lyft now can help steer growth expectations as well as moneymaking potential of ride-hailing services, said Rohit Kulkarni, managing director of SharesPost, which focuses on privately held companies going public.
A big question mark centers around the issue of drivers. According to one study, 96% of Uber drivers quit inside the first year.
How will this affect investor appetite in a company that relies heavily on part-time workers who tend to quit as soon as they find better paying gigs.
One MIT study said Uber drivers make a pathetic $3.37 per hour, once subtracting expenses. In fact, 30% of drivers “are actually losing money once vehicle expenses are included,” the study said.
“The ‘cab-hailing-system’ has been antiquated and left as a dinosaur of yesteryears,” Jeff Zell, senior research analyst and a partner at IPO Boutique in Florida, told Reuters. “The good news for ride-sharing is that it’s a market that has shown to be penetrable.”
The Lyft opportunity
One of Lyft’s challenges will be how to adapt to market changes like autonomous cars.
“With autonomous cars on the horizon, it is anyone’s guess where this sector goes in the future. But Uber and Lyft, as name-brand leaders, are leading the race and will have the war chest to be major players for years to come.”
Sure, Lyft still is a distant second in the ride-sharing category. But it’s been gaining market share due to a series of Uber incidents, including senior execs leaving, accidents and revelations of sexual harassment.
Next year’s IPO should bring more buzz, more attention to Lyft, which then makes more people aware of Lyft as an alternative to Uber.
Your move, Dara…
The Art And Science Of How To Keep Talented People Around
(Editor’s Note: The following article is a guest post by superstar entrepreneur and tech investor Jonathan Schultz.)
The number one reason talented people leave their jobs is because of the failure of their direct managers. Businesses are defined by the strength of their people. Even in the most successful company (think Google, Amazon, etc.), a bad manager can drive talented employees out the door. So what is the true art and science of keeping talented people around?
Successful managers apply targeted, dynamic coaching to each individual team member. There is not one management style that works for everyone or every situation. Managers need to adapt their approach to every situation and every team member. This is called situational leadership. This situational leadership model has been used across 70 percent of Fortune 500 companies and has received numerous accolades from training experts.
The model details how we learn new skills and the four stages of mastering new tasks. For every stage and task, managers need to adapt their approach to managing their report.
When your team member approaches a new and unfamiliar task with a determination to master it, they see opportunity. They are complete beginners in execution, but they possess high motivation and low skill. In this step, the manager needs to take a highly directive approach, where they demonstrate how the task should be done, setting concrete goals and closely reviewing the report’s progress as well. You are not being a micromanager by supporting the growth and training of your team. Sometimes your team needs to use your expertise as training wheels.
This stage is full of frustration. Why? Because it generally takes people more time to master a skill than they’d like. Discouragement will set it and their confidence will lower. While they have built up more skills, their confidence is at its lowest in this stage. In this stage, the manager needs to serve as a cheerleader and remind their team member of why they were chosen to do this task and remind them of how far they have already come.
In the third stage, people have gained enough skill to complete the task but still maintain a mentality of imposter syndrome in which they are more skilled than their confidence allows them to believe. They may even still be discouraged. In this stage, managers need to do less guiding and allow their team member to perform while self-directly more consistently. These acts of trust can boost the team member’s confidence and their dependence on the manager will fade while their confidence increases.
People reach stage four when their confidence is at the same level as their skill. They become veterans and will continue to boost their confidence and skill set. This is the stage in which the manager steps back and gives the employee the space to continue fostering growth. Check in every now and then and help as needed. Also be sure to recognize the team member for all of their accomplishments along the way.
Keeping talented people around is not hard. Managers just need to apply situational leadership and remember that every team member works and learns differently and need an environment in which they can thrive in. As the leader, you are building this environment, so make sure it is a healthy one.
Jonathan Schultz is an entrepreneur, real estate tech investor and influencer. He’s the co-founder of Onyx Equities, a leading private equity real estate firm, and has been voted one of the most powerful people in real estate. Follow Jon’s blog here.
$137 Billion On The Line With Jeff and MacKenzie Bezos Divorce
A year after becoming the richest person, Jeff Bezos, founder of Amazon.com, is getting a divorce from his wife MacKenzie. The news broke in the below tweet from Jeff last Wednesday.
— Jeff Bezos (@JeffBezos) January 9, 2019
MacKenzie is said to have played a significant role in Amazon in the early years of the company. If the split goes as predicted, she will then become the richest woman in the world.
Investors will be comfortable once the divorce does not affect the growth and profitability of Amazon.
What Are Your Favorite Christmas Songs And How Much Money Do They Make?
Christmas is the gift that keeps on giving for a select group of singers, songwriters and producers. An article in Forbes recently pegged U.S’s Christmas Music as the “Global King” compared to other genres of music like Pop.
So how much money are they talking? CNBC’s Tom Chitty explains.