Just two weeks ago, we reported that ridesharing company Lyft was preparing for its Initial Public Offering (IPO), tentatively scheduled for later this month. Now it seems Lyft’s chief competitor, Uber, is ready to follow suit with its own next month.
According to a report by Reuters, citing unnamed sources close to the matter, Uber will go public just a few short weeks after Lyft is expected to initiate its IPO. It is expected to carry with it a valuation between $100- and $120-billion. Lyft’s valuation, on the other hand, is expected in the $20- to $25-billion range.
While the two companies are superficial competitors, the hurdles each is respectively required to overcome in order to successfully launch and IPO are incredibly different.
Different Sizes, Different Needs
First of all, Uber is a much more massive company, operating in 70 countries worldwide. It also has an electric scooter and e-bike arm to its business. Lyft on the other hand has a much less diversified and straight forward business. This is underscored by Uber’s $3.3-billion loss in 2018. Lyft only lost $911-million. Of course, it took in far less, too — $2.2-billion compared to Uber’s $11.3-billion.
Perhaps the biggest hurdle facing Uber is not its diverse business or its sizable losses. Rather, its infamous corporate culture could trip up the prospects of going public. Uber CEO Dara Khosrowshahi’s will have to convince investors he’s righted the ship, in that sense.
Little will probably be able to stop — or even slow — the high-speed Uber train. Stock market investors are virtually champing at the bit for more high-growth tech firms to throw their money. And little else in the marketplace shows the opportunity for rapid growth these two ridesharing firms appear to possess.
So, if you thought the loss-prone Tesla stock was overvalued, just wait until Uber and Lyft hit the stock ticker.