Comparative Analysis: Lyft Vs. Uber Technologies
VC Experts
Track Uber and Lyft's Valuation & Stock Prices
There are almost as many methods of calculating value as there are world religions, since the questions are metaphysical in part and depend on the appetites of the observer. In one of the most common scenarios, a five-year forecast is prepared, the thought being that in the fifth year (assuming the projections are accurate) an exit strategy will be implemented; that is, investors will sell their securities for cash or the securities will become publicly traded, the equivalent of cash. It is usually assumed that the investors will realize their entire return upon implementation of the exit strategy; there will be no interim returns since all revenues will be retained in the business. The valuation formula most often used in connection with the forecast is relatively simple.
An investor plans to invest X dollars in the enterprise today for some to-be-determined percentage of the company's equity. The projections predict the company will enjoy Y dollars of net after-tax earnings as of the day the exit strategy is accomplished; that is, the company is sold or goes public. The analyst then picks a multiple of earnings per share in order to hypothesize what the stock might sell for in a merger or an IPO. Since there is no way of forecasting that multiple, the next best strategy is to use existing multiples in the given industry.[1]
By taking a look at other players in your given industry, you are not only keeping an eye on the competition, but also giving yourself something to measure up against. Whether it be multiples, strategy, or valuations, there are few and far between reliable sources for accurate information, especially when it comes to private company financings. That's why we have provided an example below -featuring two San Francisco based rideshare companies: Lyft and Uber Technologies. This is the type of information that the VC Experts Intelligence Database has to offer - a verified and reliable source that provides complete details on equity financing events for private companies. We pride ourselves in accuracy and back up all of our numbers with federal and state regulatory filings, which are also provided to premium users for download.
[1] "Valuation and Pricing" – Joe Bartlett, Founder and Chairman of VC Experts
Preferred vs. Common Price Per Share With Valuation
Most Recent Financing Round
| LYFT INC | ||||
| Date | Amount | Valuation | Est. Fully Diluted Shares | Preferred Price Per Share |
| 04/02/2014 | $250.00M | $1,003,058,100 | 99,000,000 | $10.13 |
| Round: Series D Direction: Up Round Liquidation Preference: Pari Passu Liquidation Multiple: 0-1x Stock Type: Conventional Convertible Capped Participation: No Anti-Dilution: Weighted Average Redemption: No Cumulative Dividends: No Dividend Rate: 8% Pay to Play: No Get The Updated Company Report for Lyft Inc |
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| UBER TECHNOLOGIES INC | ||||
| Date | Amount | Valuation | Est. Fully Diluted Shares | Preferred Price Per Share |
| 08/14/2013 | $257.79M | $3,480,410,247 | 24,417,077 | $142.54 |
| Round: Series C Direction: Up Round Liquidation Preference: Pari Passu Liquidation Multiple: >1-2x Stock Type: Conventional Convertible Capped Participation: No Anti-Dilution: Weighted Average Redemption: NO Cumulative Dividends: No Dividend Rate: 8% Pay to Play: No Get The Updated Company Report for Uber Technologies Inc |
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Investment Amounts ($M)
General Information
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Lyft: Key Management
• Logan Green - Founder, CEO, Treasurer, Secretary, Director• John Zimmer - Founder, COO, Director • Geoff Lewis - Director (The Founders Fund) • Raj Kapoor - Director (Mayfield Fund) • Scott Weiss - Director (Andreessen Horowitz) |
Uber Technologies: Key Management
• Travis Kalanick - Co-Founder, CEO, Director• Garrett Camp - Co-Founder, Chairman of the Board • Thuan Pham - CTO • Ryan Graves - Head of Global Operations, Director • Salle Yoo - General Counsel • Bill Gurley - Director (Benchmark Capital) • David C. Drummond - Director (Google Ventures) • David Bonderman - Director (TPG Capital LP) |
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Lyft: Key Information
• Address: 548 Market St. #68514, San Francisco, CA 94104• Geographic Region: Silicon Valley • Industry: Software • SIC Codes: 4119 - Local Passenger Transportation • NAICS Codes: 485320 - Limousine Service • Legal Counsel: Silicon Legal Strategy • Company Website: http://www.lyft.com/ |
Uber Technologies: Key Information
• Address: 800 Market St., 7th Floor, San Francisco, CA 94102• Geographic Region: Silicon Valley • Industry: Software • SIC Codes: 4119 - Local Passenger Transportation • NAICS Codes: 485320 - Limousine Service • Legal Counsel: Fenwick & West LLP • Company Website: http://www.uber.com/ |
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Lyft: Investors (Current & Historic)
• Andreessen Horowitz LLC• The Founders Fund • Mayfield Fund • Coatue Management LLC • Alibaba Investment Limited • K9 Ventures LP • Floodgate Fund, L.P. |
Uber Technologies: Investors (Current & Historic)
• TPG Capital LP• Google Ventures • First Round Capital • Lowercase Capital LLC • Menlo Ventures • Bezos Expeditions • Benchmark Capital • Godman Sachs & Co • Founder Collective |
VC Experts.com, Inc. Disclaimer: The information contained herein is from sources deemed reliable; it does not, however, purport to constitute investment advice nor does VC Experts represent that it contains all information concerning the identified Company deemed necessary or appropriate for investment decisions. VC Experts is neither a broker/dealer nor investment adviser and has no financial interest in the Company analyzed nor in the sale or purchase of any of its securities. The information and data are for reference purposes only and no implied or expressed warranties or assurances as to its accuracy or completeness are furnished by VC Experts. Estimates of valuation are, as indicated, estimates based on such information as we found available, the completeness of which is neither represented or guaranteed; users for any purpose are cautioned and required to undertake and perform their own investigations and due diligence. To the extent that the information incorporates content from specified sources of financial information, VC Experts disclaims any responsibility for the accuracy or completeness of such content.
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What Do The Deal Terms Mean?
Conventional Convertible Preferred Stock: A type of preferred stock that can also be referred to as "Non-Participating Preferred Stock". This preferred stock typically receives a liquidation preference prior to the common stock, and does not participate on an "as if converted basis" with common stock in any remaining proceeds of a defined "liquidation" event. Upon such a "liquidation" event, holders of Conventional Convertible Preferred Stock must choose whether to receive their liquidation preference or convert their shares to Common Stock in order to participate in the pro rata distribution of assets.
Dividends: The payments designated by the Board of Directors to be distributed among the shares outstanding. The type of share determines the amount. On preferred shares, it is generally a fixed amount. With common shares, the dividend can be omitted if the Directors decide to invest the money in a capital expenditure or if the business is slumping. If the dividend is paid, the amount varies depending on the amount of cash on hand.
There are several types of dividends:
Cumulative—Missed dividend payments that continue to accrue.
Non-cumulative—Missed dividend payments that do not accrue.
Participating—Dividends which share (participate) with common stock.
Non-participating—Dividends which do not share with common stock.
Liquidation Preference/Multiple: The amount per share that a holder of a given series of Preferred Stock will receive prior to distribution of amounts to holders of other series of Preferred Stock or Common Stock. This is usually designated as a multiple of the Issue Price, for example 2X or 3X, and there may be multiple layers of Liquidation Preferences as different groups of investors buy shares in different series. For example, holders of Series B Preferred Stock may be entitled to receive 3X their Issue Price, and then if any money is left, holders of Series A Preferred Stock may be entitled to receive 2X their Issue Price and then holders of Common Stock receive whatever is left. The trigger for the payment of the Liquidation Preference is typically a sale or liquidation of the company, such as a merger or sale of assets.
Anti Dilution Protection: Contractual measures that allow investors in convertible preferred shares an automatic reduction in the conversion price, meaning more common shares on conversion, if a subsequent round is a "down round," thereby mitigating down round dilution.
Pay-to-Play Provisions: A "Pay to Play" provision is a requirement for an existing investor to participate in a subsequent investment round, especially a Down Round. Where Pay to Play provisions exist, an investor's failure to purchase its pro-rata portion of a subsequent investment round will result in conversion of that investor's Preferred Stock into Common Stock or another less valuable series of Preferred Stock.
Post-Money Valuation: The valuation of a company immediately after the most recent round of financing. For example, a venture capitalist may invest $3.5 million in a company valued at $2 million "pre-money" (before the investment was made). As a result, the startup will have a post-money valuation of $5.5 million.