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Three months after Lyft and China’s Didi Kuaidi inked a deal, the ride-hailing apps are adding two more brethren in what is amounting to an international counterattack against the rapid expansion of Uber.
Ola Cabs, an Indian startup that operates in 102 cities, and GrabTaxi, which extends to six southeast Asian countries, announced on Thursday they are joining the strategic partnership with Lyft and Didi Kuaidi. The four will roll out joint products beginning early next year. So if U.S. travelers land in India or Malaysia, they can order an Ola or GrabTaxi cab directly from the Lyft app. And vice versa.
For the quartet of well-funded startups, it’s a tacit admission that their growth is capped within their respective regions. And, more critically, it’s a concession that linking arms is the best shot at rivaling the better-funded Uber, which is not relenting in its bid for global reach.
“This is the major next step for our global ride-sharing strategy,” said Lyft President John Zimmer. “For Asia, partnering is the smartest expansion strategy.”
Zimmer added that his new partners’ knowledge of local regulatory dynamics is another key reason. This is particularly important for Asian countries, which have thorny payments processing rules. Left unsaid is that Ola and GrabTaxi aren’t likely to concede turf if Lyft tries to enter. Besides, it’s busy fighting off Uber: The startup is planning to raise another $2.1 billion at a valuation of $62.5 billion, according to a Bloomberg report on Thursday.
GrabTaxi has raised around $680 million and Ola has raised over $1 billion; SoftBank Capital and Tiger Global Management have put money in both. Incidentally, Bloomberg’s report on Thursday names Tiger as an investor in Uber.
When Lyft partnered with Didi Kuaidi, that included a $100 million investment from the Chinese company into its American counterpart. There’s no investment this time around, Lyft said.
Earlier this week, Didi Kuaidi put out figures that it commands 90 percent of the ride-hailing market in Beijing. Last month, Lyft said it had a run rate of $1 billion — but that’s deceptive since that figure uses gross revenue, before rider discounts and the substantial payout to drivers. Bloomberg reported that Lyft saw net revenue of $46.7 million in the first half of the year with losses of $127 million. Lyft declined to comment on that.
Zimmer also batted away a question that today’s news portends a potential merger. “Not necessarily. We’re very focused on the U.S.,” he said. “Our plan is to be a standalone business.”
This article originally appeared on Recode.net.
