Lime has announced that it has raised a $170 million funding round. Uber is the leading investor with existing investors Alphabet, Bain Capital Ventures, GV and others also participating. The Information first reported on the new funding round before the official announcement.
As part of the deal, Lime is also acquiring Uber’s micromobility subsidiary Jump. There will be more integrations between Uber and Jump in the future, but both apps will remain active for now. It’s still unclear whether you’re going to be able to unlock Lime electric scooters in the Uber app, and Jump scooters and electric bikes in the Lime app.
“We’re glad that our customers will continue to have access to bikes and scooters in both our apps because we believe micro-mobility is a critical part of the urban landscape, now more than ever,” Uber CEO Dara Khosrowshahi said in the press release.
Yesterday, Uber announced a massive round of layoffs. Around 14% of the company have been laid off — it represents 3,700 employees. Cuts come mostly from community operations, recruiting and Greenlight hubs, the company’s in-person help centers for drivers. Uber Eats is also pulling out of seven markets around the world.
Uber is trying to cut costs as usage has been plummeting due to the COVID-19 pandemic and lockdowns around the world. With today’s deal, the company is also going to save on operating costs as Jump employees transition from Uber to Lime.
On April 30, Lime also laid off 13% of its workforce, representing about 80 employees. “Almost overnight, our company went from being on the eve of accomplishing an unprecedented milestone — the first next-generation micro-mobility company to reach profitability — to one where we had to pause operations in 99% of our markets worldwide to support cities’ efforts at social distancing. Needless to say, while we thought we had planned for all possibilities this year, we did not anticipate a global pandemic,” the company’s CEO wrote at the time.
According to The Information’s report, Lime’s valuation is down 79% to $510 million with this round. In April 2019, Lime raised at a $2.4 billion valuation.
In other news, Lime has a new chief executive officer — Wayne Ting is getting a promotion as he joined Lime in October 2018 as Global Head of Operations and Strategy.
Last year, Lime co-founder Toby Sun stepped down from the CEO role. Brad Bao, another co-founder of the company, assumed chief responsibilities. Following today’s news, Bao will remain chairman of the board with Ting taking on the CEO position.
Uber’s stock is currently trading up 6.61% compared to yesterday’s closing price during pre-market trading.