US-based ride ordering service Lyft has confirmed it is closing a $1bn funding round led by carmaker General Motors, which is investing $500m in connection with a strategic partnership.
The round, which will be closed at a $5.5bn post-money valuation, also featured e-commerce companies Alibaba and Rakuten, Chinese ride hailing company Didi Kuaidi and investment management firm Janus Capital Management.
Saudi Arabia-based investment holding company Kingdom Holding, reported by the Wall Street Journal last month to be investing $248m, has committed $100m, bringing the total invested by Kingdom and its affiliates to $250m.
Lyft operates the second largest ride hailing business in the US, after Uber, and is responsible for some seven million rides each month across 190 cities.
As reported yesterday, GM and Lyft have agreed a long-term alliance to build an autonomous on-demand car network that will match GM’s autonomous car technology with Lyft’s experience in automating ride sharing, route matching and payment.
The companies also intend to set up a range of rental hubs across the US where Lyft drivers will be able to rent GM vehicles.
John Zimmer, president and co-founder of Lyft, said: “This raise and collaboration with GM are exciting milestones in our three-year history that continue Lyft’s leadership in redefining traditional car ownership.
“We are thrilled to take this momentum into the new year and continue improving life in our cities through more affordable, accessible and enjoyable transportation.”
Lyft has now raised more than $2bn in funding since it was launched in 2012, securing $680m in a May 2015 series E round backed by Alibaba, Rakuten, Didi Kuaidi, internet company Tencent and Icahn Enterprises, Carl Icahn’s investment vehicle.
The company had already raised $250m in series D funding in 2014 from Alibaba, Coatue Management, Third Point Ventures, Andreessen Horowitz, Founders Fund and Mayfield Fund.