By Amanda Weston
Institutional investors won't be the only ones to benefit from Lyft's upcoming initial public offering ー those behind the wheel stand to gain as well.
"If you've got 10,000 rides with Lyft, you actually get a $1,000 cash bonus that you can then go invest in the IPO," Harry Campbell, owner and founder of The Rideshare Guy blog and podcast, told Cheddar Wednesday. "And it sounds like this IPO is off to a good start. So I think it was really a nice surprise for a lot of drivers who frankly weren't expecting much out of this IPO."
Reuters reported Tuesday Lyft's IPO is already oversubscribed due to investor interest, increasing the chance of the company meeting or exceeding a $23 billion valuation.
"Those who qualified for the cash bonus are going to be able to buy in at that pre-IPO price," Campbell said. "So they won't have to wait until it hits the markets, which can be a valued position if it sounds like it's oversubscribed and there's a lot of interest. Drivers could potentially make some money off of this."
While Campbell has been driving for Uber and Lyft since 2014, he does not qualify for the Lyft cash bonus, saying 10,000 rides is "a lot." He said the drivers he knows who qualified are based in large cities like San Francisco and Los Angeles.
"One of our top contributors, he's in San Francisco. He's got 14,000 rides and he's sort of looking at it as kind of as found money," Campbell said.
Campbell, however, said he didn't expect driver pay ー which has declined over the past few years ー to increase more generally after Lyft's public offering.
"I don't know that they're going to be making a ton of investment specifically in paying drivers more, but it does seem like they're looking at potential investments around improving customer service," Campbell said.
"They announced a big expansion to their program called the Driver Advisory Council, which helps get input and feedback from drivers. They're expanding their driver hubs which provide in-person support. So I suspect some of that money will be earmarked for drivers but not directly, and then it sounds like a lot of the money may go into some of their other mobility services like scooters and bikes, which are probably going to cost them a lot in the future."
Uber is also racing toward a much-anticipated IPO, possibly with its own driver bonuses.
"I think we're going to see a lot more drivers who qualify when Uber announces their program, which from earlier reporting sounds like it'll be pretty similar," Campbell said.
For full interview click here.