Uber and Lyft: How Each Company Got Its Start
Uber and Lyft have been battling each other for rideshare supremacy for quite some time, with no end in sight. But how did each company get off the ground, and how does that play into today’s fierce competition?
Birthplace: San Francisco, California
Interestingly enough, both companies started off and are still headquartered in San Francisco, home of Silicon Valley and many high-tech companies. This is not such a big coincidence, as many tech startups find their footing there, thanks to angel investors and business incubators.
Uber had the head start, being founded in 2009 while Lyft was founded in 2102. That three-year difference could be why Uber has been in the lead from the start, as they were able to gobble up more market share early on.
Initial Concepts: UberCab and Zimride
Uber was originally called UberCab and was the brainchild of Garrett Camp who had previously founded StumbleUpon. They dropped the “Cab” from their name in 2011 and when they released their app they were simply known as Uber.
Lyft got its start as a service called Zimride that would coordinate long distance travelers so that they could share the same ride and split the costs. Only later did they expand its concept and rebrand it so that it had a more universal appeal and could be used by anyone with the app.
Quick Tip: One thing that drivers for Uber and Lyft should have is rideshare insurance so they’re covered 100% of the time. The way things are set up now creates a gap of coverage from the time you drive to pick up your next rider until they get into your car.
Launching Their Apps
Things didn’t really take off for each company until after they launched their smartphone apps that allowed users to see where cars were and how long it would take to get to them. Uber initially assembled a team of scientists, engineers, and other geniuses to design its app, and further updates and upgrades are continuously being implemented by Uber and Lyft.
Both companies underwent and are still undergoing a series of funding campaigns to have the necessary capital to do what they need to compete with each other. Several companies are backing each service, including Google and Waymo by way of Alphabet, as well as nearly every major automaker.
As these companies rally behind one service or the other, they not only pump them up with cash but with technology partnerships and other support.
Current Valuations and Market Share
Neither company is publicly traded, and there’s only rumors and early rumblings of IPOs. Uber has been projected as having a value as high as $70 billion, with IPO hopes of $100 billion. Lyft on the other hand has been recently valued at $11 billion, although they are gaining momentum thanks to the controversy surrounding some of the tactics used by Uber.
At its height in 2014, Uber controlled over 90% of the market and it looked like they were going to be the default winner. Now that market share sits around 75% with Lyft making up around 23% and other services eking out the leftover 2% or so.