Running a ride-hailing startup can be expensive and profits don’t start appearing until several years into the game—if you are lucky. Lyft remains stuck in the pre-profits stage even as its revenues took off: Bloomberg reports the company reported $700M in revenue, but still recorded a $600M loss in 2016. The $700M figured represents a 250 percent increase in revenue over 2015.
Lyft, the country's second-largest ride-hailing startup behind Uber, has found itself taking heavy losses thanks to driver bonuses and rider discounts. After completing 160 million rides in 2016, Uber experienced a $3.75 loss on each ride. Although this may seem steep, it is significantly better than the $7.77 loss they experience on each ride in 2015.
Unlike Uber, whose busiest markets are Mexico City and Sao Paulo, Lyft currently only operates in the U.S., though it has plans to expand internationally in the near future. Although the company reportedly has $1 billion in cash on hand, their current spending trend indicates they will need to raise money again sometime in the next 20 months to keep operations going.