Alphabet considers Lyft investment

Hi there,

Our latest strategy teardown covers everything Uber, diving into data on the company’s financing and valuation, competitive landscape, and possible moves under new management. Check it out here (clients with Expert Research access can also jump right into the full 8,000+ word report).

Several recent developments also dovetail with topics we touch on in the teardown (cue jokes about Uber having done a good job of tearing itself down so far this year). For one, details emerged yesterday around Lyft’s plans for international expansion. Uber’s domestic rival appears to be taking an incremental approach, beginning in Canada and moving to New Zealand and Australia should that go.

By contrast, Uber operates in nearly a hundred countries globally. We analyzed Uber’s over 1,900 open job listings as of the end of August, and visualizing the geographic spread of these positions gives a good sense of the company’s current priorities:

The top ex-US hiring destinations of India, Brazil, and Mexico were an exact match for SVP of business David Ritcher’s list of Uber’s key international bets.

Uber’s expansion strategy has shifted dramatically over the last year, with the company divesting its Chinese and Russian operations to local operators in exchange for minority stakes. The moves marked a significant reversal for the pugnacious Uber and its affinity for fighting wars of attrition on multiple fronts.

New CEO Dara Khosrowshahi has committed to “paying the bills” and floated an IPO target of 18-36 months. Continuing to narrow the focus of Uber’s sprawling international operations would further rein in the company’s losses abroad, especially as its rivals rake in larger financings that make it tough for Uber to simply outspend opponents:

Although Uber currently lists numerous open positions in Southeast Asia, the region is a potential target for Khosrowshahi to scale back. Both local rivals Grab and Go-Jek are now flush with new capital (and as mentioned above, Uber has indeed named its top 3 priorities elsewhere).

Lyft looks to be bulking up further, with Alphabet now seriously considering a $1B investment in the company (recall that Alphabet’s GV venture arm was an early Uber investor). As if things weren’t complicated enough, SoftBank is also said to be nearing a $10B Uber investment that would see both new and existing shares change hands, and further expand its ride-hailing portfolio:

Read on for implications of a SoftBank deal, along with lots more infographics, data, and analysis.

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Kerry
@kerrygwu