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On March 29, 2019, Lyft became the first ride-hailing company in history to list its shares on a public stock exchange — and Wall Street was watching. The San Francisco-based company priced its initial public offering at $72 per share, above its already-elevated target range, raising $2.34 billion and valuing the business at approximately $24 billion. When trading opened on the Nasdaq that Friday morning, shares immediately surged to $87.24 — a jump of 21 per cent — as retail and institutional investors scrambled to buy a piece of what Wedbush Securities described as one of the most transformational consumer technology names of the decade. By the closing bell, Lyft had settled at $78.29, up a more modest 8.7 per cent, giving the company a market capitalisation of around $22.4 billion.

For co-founders Logan Green and John Zimmer, the day was the culmination of a journey that had seen Lyft grow from a scrappy carpooling startup into the second-largest ride-hailing platform in the United States, processing millions of trips a day and generating $2.2 billion in revenue in 2018. The festivities — pink confetti falling from the ceiling at a Los Angeles event space as Green and Zimmer cheered with employees — captured the mood of a company that had long operated in the shadow of its far-better-funded rival, Uber. ‘Four or five years ago, Uber had thirty times the amount of cash as us,’ president John Zimmer had said at a Fortune conference the previous year. ‘Everyone assumed we were dead.’ They were not dead. They were, on this day, worth $22 billion.

But behind the celebrations lay a financial reality that would define the coming months of investor scrutiny. Lyft had reported a net loss of $911 million in 2018 — on average, $1.47 for every single ride it facilitated — and had never turned a quarterly profit in its seven-year history. This was not, in itself, unusual for a major technology IPO: Amazon, Twitter, and Spotify had all been loss-making when they went public. What unsettled some analysts was the structural nature of the losses and the absence of a clear, near-term route to profitability. The very day of the IPO, Renaissance Capital noted that Lyft’s $911 million loss represented the largest net loss ever reported by a company entering the public markets for the first time.

The IPO also served as the opening act for what 2019’s biggest financial story: a stampede of Silicon Valley unicorns heading for public markets. Zoom, Pinterest, Uber, Slack, and Postmates were all in various stages of preparing for their own listings, and investors were watching Lyft’s performance as a litmus test for public appetite. The early signals were mixed. Lyft’s modest first-day gain — well below the historic average for IPOs priced above range — and its subsequent 12 per cent fall in the second day of trading sent a cautionary signal to rivals. For ordinary investors eyeing the class of 2019 tech IPOs, the lesson was already forming: hype and valuation are not the same thing, and the price you pay on day one may not reflect the price you will get on day one thousand.