As part of the deal, David Lawee - a partner at Alphabet's CapitalG growth equity fund - will join Lyft's board of directors. "Ridesharing is still in its early days and we look forward to seeing Lyft continue its impressive growth".
As we explained recently, Lyft has been putting together a host of partnerships of late, an Android-like strategy that is positioning the company well for the coming years.
But the financing also gives Lyft a new and formidable partner in Alphabet. GM president Dan Ammann told Reuters that any further plans to collaborate with Lyft were "not defined at this time". The great interest Alphabet has in this small ride-hailing startup indicates that the Waymo autonomous vehicle technology might get better integrated into Lyft's transportation system.
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The Google owner is also linked to Uber after a second investment arm, GV, backed it in 2013 - but that was before Uber began to develop autonomous cars, in direct competition to Alphabet. Waymo is Alphabet's self-driving auto unit and has been locked in a legal battle with Uber for months. Waymo has accused Uber of stealing trade secrets after it hired a former Google employee.
Alphabet's funding boost will help Lyft step up its challenge just as Uber faces up to the potential loss of its London licence. It was last valued at almost $70 billion.
Uber has also been embroiled in sexual harassment claims, lawsuits and U.S. Department of Justice investigations over its business practices.
"It is completely rational to me as an investor to take all of the money off the table now given all of the drama, all of the toxicity, all of the DOJ investigations", he said. Nothing came of the meeting, but the company restarted conversations during the previous year, in the period leading up to Transport for London's bombshell ruling declaring Uber not fit and proper to hold a private hire license. The people went on to say that it is yet to be decided on which company will be the primary underwriter of Lyft for the I.P.O. These scandals have benefited Lyft in one way or the other as the two companies are locked in a battle for supremacy in the United States. As a result, Lyft has announced that it's looking for ways to go public before the end of next year.