Daily Times

SAN FRANCISCO: Ride services company Lyft Inc is poised to take advantage of a surge of investor interest in the transportation service sector as it closes in on a possible sale of the company or new capital raise, people familiar with the situation said.

Venture capitalists and corporate investors have poured nearly $28 billion into the ride services sector over the past decade, propelling growth at Lyft, China’s Didi Chuxing Technology Co and Uber Technologies Inc , according to a Reuters analysis. Lyft has been working for about a year with Silicon Valley investment bank Qatalyst Partners, people familiar with the matter said. Lyft has used the firm to look at acquisition offers, investments, fundraising and partnership deals.

Founded by Frank Quattrone, Qatalyst is best known for helping technology companies find buyers. It had advised LinkedIn Corp on its sale to Microsoft Corp .

While it is not certain if Lyft will proceed with a deal, people familiar with the situation said General Motors Co and Didi Chuxing, which already have investments in Lyft, could expand their stakes in the San Francisco-based startup. One Didi investor said any role the Chinese ride service played in a Lyft deal would likely be in coordination with a large automaker, rather than on its own. The investor did not want to be identified. A Lyft spokeswoman declined to comment on whether any investment talks were going on, or on the relationship with Qatalyst, which was previously reported by the Wall Street Journal. GM, the third-largest global automaker by vehicle sales, reaffirmed its commitment to expanding services with Lyft, but did not comment on potential future investments. GM invested $500 million in Lyft earlier this year.

Didi has declined to comment. The company, which is battling Uber in the Chinese market, said in June that it had raised $7.3 billion in new funding, including $1 billion from Apple Inc. Lyft’s capital raising efforts come as an array of deep-pocketed players – from big auto makers to Saudi Arabia’s Public Investment Fund – are betting billions of dollars that selling transportation services a ride at a time will become a profitable, global business.

More than 70 percent of the $38 billion invested in all transportation-related startups during the past decade, including autonomous driving technology companies, has gone into ride services companies, according to the Reuters analysis of venture investments in more than 500 mobility-related startups over the past decade.