Lyft went public only a few days ago – March 29th for those curious – and while it started selling shares at the high range of its estimated price, it ended the day with modest gains. With Uber likely going public soon, it seems important to evaluate just how successful the ride-sharing and last-mile industry have been.
One way to evaluate success is how much funding the sector has raised. Based on a report for TechCrunch, ride-hailing, food delivery and last-mile transportation has raised “less than 10 percent of the total venture dollar volume reported for each of the past five full calendar years.”
Investment in these industries has grown steadily from 2014 to 2017, 4.8% to 8.5%, and dropping off in 2018 (5.6%). However, these percentages are more than what they appear. For example, in 2017, these companies earned more than $22 million in funding and more than $18 billion in 2018.
For investors into these companies before they were public, Lyft’s success on the public market should point to good fortune for other companies as the leaders of the market go public. But given that Uber and Lyft have struggled to turn a profit, reports suggest that investors be patient as the companies take a long term approach to earning profits.