Google’s parent company, Alphabet, has more than doubled its investment in Lyft, generating $1 billion in just 17 months. It seems that the company makes betting huge on transportation. CapitalG, the latest investment venture of Alphabet, doubled its investment in Lyft after the IPO of the company specialized in this area.
CapitalG invested $500 million in Lyft in October 2017 for $ 39.75 per share. After 11% of Lyft’s stake of more than $ 80 per share, that bet represents more than a billion dollars. Alphabet has a complicated but lucrative relationship with Lyft and its main competitor, Uber.
In 2013, the company invested more than $ 250 Million in Uber through its start-up venture capital subsidiary, GV, formerly known as Google Ventures.
But the two companies gradually began competing in different areas, including autonomous driving technology. Then Alphabet challenged Uber in 2017, alleging that Uber stole trade secrets at the time of acquisition of an autonomous driving technology startup established by Anthony Levandowski, former Google manager. In last February the case was settled and Uber decided to pay Waymo a 0.34% stake, which came to roughly $245 Million.
The alphabet got its share in Lyft while the Uber trial continued. Thanks to this stake, it is Lyft’s fifth largest investor behind GM, Japan’s Rakuten, Andreessen Horowitz; a venture capital firm, and Fidelity. Moreover, David Lawee, a partner in CapitalG, is a member of the Board of Directors of Lyft.
Last year, Alphabet revealed that its equity investments yielded about $3 Billion, mainly due to its stake in Uber in 2013. Assuming that Uber’s value today is the same as before, Alphabet’s total stake amid Uber and Lyft is now over $4 Billion.