It is a cycle and patterns repeat: Uber and Lyft will merge or Uber will acquire Lyft. That was my call in July 2017 when I wrote: “Government will see their struggles, and will dismiss any antitrust concern. The result: it will bless their union.
As they become peer-competitors and rivalries, they will destroy the sector. Similar rivalries have ended together: Elance/Odesk (now UpWork), Groupon / LivingSocial, Sirius / XM and Rover / DogVacay. Please add DraftKings and FanDuel to the list.”
Sure, the government blocked DraftKings and FanDuel merger. But if you watch sports in America, you will see that these two companies are enjoying their co-opetition.
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Back to Lyft, here is hard news: “Lyft has announced a major C-suite shakeup. Co-founders Logan Green and John Zimmer are stepping back from their day-to-day roles as CEO and president, respectively; board member and former Amazon exec David Risher will take over as CEO from April 17. Lyft stock has tumbled some 70% over the past 12 months as Uber has sped ahead in the ride-hailing race, now controlling 74% of the U.S. ride-share market, according to research firm YipitData. Meanwhile, the fact that Risher — a veteran of Amazon and Microsoft — hasn’t run a for-profit business in years is fueling sale rumors, The Information notes.”
The regulator may not like a merger but the fact remains that there are not many companies which will lift Lyft. Unlike Uber which is highly diversified on products and geography, Lyft is just a small thing. Do not invest in companies that cannot build natural moats in markets, they hardly create value!
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What does Lyft do differently from Uber in the mobility space, cheaper price or excellent service? It does not appear like Lyft was built for impact, but rather as a stand-in, waiting to be lifted up by a more robust organization.
I think the hashtag should simply read: #LyftGoesToUber, until the union is ratified.