Technology

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

Today the big news that falls into our orbit is about DraftKings, a sports betting service focused on fantasy sports that will go public via a reverse merger. Not too long ago DraftKings and its erstwhile rival FanDuel were ubiquitous on television; now the two are fractions of what they once were.

Letchat about what went wrong and whatnext.

The ascent

Both DraftKings and FanDuel raised modest sums until the latter half of 2014.

FanDuelSeries A was worth just $1.2 million back in 2009. Its $4 million Series B in 2011 almost sounds like a joke. An ensuing 2013 Series C just tipped the scales at just $11 million. Things picked up in Q3 2014.

DraftKingstory is similar, if slightly more aggressive. A $9.8 million Series A in 2013 was followed by a $24 million Series B that same year. Then in Q3 2014 things started to go faster.

In the third quarter of 2014, FanDuel raised a $70 million Series D. In the same three-month period, DraftKings raised $41 million. The next year, FanDuel raised a $275 million round in July. That same month DraftKings raised $300 million. All of a sudden the companies were unicorns, worth a combined $2.2 billion, post-money.

FanDuelfunding history (according to Crunchbase data) then slowed, while DraftKings raised another $150 million in 2016 and $118.7 million in 2017. But the great capital arms race had reached its zenith and fallen for the two companies.

The punishing fight across hundreds of millions of dollars in TV ads for market share between the two led to a merger proposal in 2016. That was called off in 2017. From rising titans blanketing your screens with ads to a failed combination, what went wrong?

The descent

What happened is actually very understandable in light of WeWorkfailure to go public earlier this year: The companies were torching capital in the name of growth.

Just in time for Christmas, Lyft has brought back to San Francisco its pedal-assist e-bikes. The plan is to roll out hundreds of bikes each week until it hits 4,000 by the end of April 2020. This comes after Lyft had to pull its e-bikes in light of battery-related fires in July.

&After identifying the root cause of the battery issues, we made the decision to work with a different battery supplier,& Lyft wrote in a blog post last month. &We&re now receiving new batteries, testing them and reassembling ebikes.&

That announcement came along with Lyft reaching a four-year agreement with the San Francisco Municipal Transportation Agency to deploy 4,000 of its e-bikes. The resolution was the result of Lyft suing the city of San Francisco, which led to the court ordering Lyft and the SFMTA to negotiate under the &Right of First Offer& provision.

As part of the agreement, Lyft must provide reliable and redundant services, utilize modular design and pay $300,000 in fees to fund the installation of additional bike racks. If Lyft fails to do this, the SFMTA has the right to permit a second operator. For now, JUMP is still permitted to operate its 500 e-bikes, at least until March 1, 2020, as Lyft rolls out its full fleet.

Until March, Lyft will allow Bay Wheels members to access the e-bikes at no additional cost. Additional pricing will go into effect starting March 1, but Lyft says it&engaging our community partners and members to inform the best approach to pricing ebike rides so we can provide the best service possible, since ebikes have higher operational costs per ride than pedal bikes.&

American automotive technology startup Rivian has raised $1.3 billion in new funding, the company announced today. The new investment is the fourth round of capital announced by the company in 2019 alone, following prior announcements of $700 million led by Amazon, $500 million from Ford (which includes a collaboration on electric vehicle technology) and $350 million from Cox Automotive.

Thata lot of money, but Rivian not your typical startup, as itaiming to bring fully electric vehicles to market, including the R1T pickup truck and the R1S sport utility vehicle. Both of those are consumer cars, which the company aims to bring to market starting at the end of next year — and Rivian is also working with Amazon on all-electric delivery vans, of which the commerce giant has ordered 100,000, with a target of starting deliveries of the first of those in 2021.

Riviannew monster round includes participation from Amazon and Ford Motor Company, along with funds advised by T. Rowe Price Associates and BlackRock, the company said in a release. Itnot adding any new board seats attached to this funding, and itnot sharing any further details on the specific funds involved in the investment at this time.

The company, founded in 2009, has R-D facilities in a number of cities globally, and also has a 2.6-million-square-foot manufacturing facility in Normal, Ill. It debuted its pickup and SUV at the LA Auto Show last November, and the vehicles will launch with higher-end trim levels first, including up to 410 miles of range on a single charge. Base prices for the R1T pickup start at $69,000 before any tax credits are applied, while the R1S SUV starts at $72,500; Rivian has been taking pre-order reservations, available with a $1,000 deposit.

For a company that in many ways has seemed to appear out of nowhere, Riviancapitalization and partnerships make it one of the better existing contenders to take on Tesla, especially in the truck and SUV categories, where Tesla has less presence, with only the high-end Model X actually available to purchase so far.