Gett announced today the closing down of Juno, its shared travel service in the US. Gett acquired Juno in 2017 for $200 million, and moved its activity in New York to that brand name. According to US media reports, Juno lost money all through 2019, and Gett looked for a buyer for it. A document offering the company for sale published in Quartz last March stated that Juno was the third largest shared travel company in New York, after Uber and Lyft.
Simultaneously with the closing down of Juno, Gett announced that it would cooperate with Lyft in New York. This cooperation, which will begin in 2020, will enable Gett's business customers to order a shared trip on Lyft via Gett's app, through their business accounts. The company explained that the purpose of this measure was to support the company's public offering, scheduled for the first quarter of 2020, which had been postponed from the originally planned time in December 2019. In preparation for its offering, Gett is shedding unprofitable activity and focusing on appealing to business customers in order to achieve a profit.
These actions concern only Gett's activity in New York, where there is stiff competition between the various shared travel companies and between them and taxi cabs. The intense competition is leading to substantial marketing expenses for the companies. Furthermore, New York was among the first cities to pass legislation setting a minimum wage for drivers on shared travel apps, which led to higher operating costs for these companies.
Gett, founded in 2010 by Roi Mor and Dave Waiser, began its activity based on an app for ordering taxis and deliveries by phone. The company expanded with time, and now operates in Israel, Russia, the UK, and the US. Gett has over 15,000 business customers.
Gett raised $200 million in equity and debt last May at a company valuation of $1.5 billion. Shortly before that, the company management notified its employees that it was planning an IPO in 2019, but subsequently postponed it. Gett's taxi ordering service has faced tough competition from shared travel companies, and therefore entered additional areas in recent years in which competition was not as fierce: business customers and related services, such as its delivery service.
Lyft, which held its IPO in March 2019, has a $13 billion market cap.
Published by Globes, Israel business news - en.globes.co.il - on November 18, 2019
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