GM Buys Sidecar's Assets as It Preps Its Own Ride-Hailing Service
Sidecar closed shop at the end of December after a multi-year fight to stay in the race against rivals Uber and Lyft and their ever-growing war chests and market shares.
This story originally appeared on Fortune Magazine
Investing a plump $500 million into rival Lyft isn't the only move General Motors is making against ride-hailing giant Uber: The company has reportedly also bought the remains of recently defunct third-place player Sidecar.
The automaker has purchased Sidecar's technology and most of the assets, according to a report from Bloomberg, citing anonymous sources. Though the companies haven't disclosed terms of the deal, a Bloomberg source says it was less than the $39 million the startup had raised in funding over the years. As part of the deal, 20 of Sidecar's employees are joining GM, including the company's co-founder and chief technology officer, Jahan Khanna -- but not co-founder and CEO Sunil Paul.
A Fortune request to GM for comment is pending.
Sidecar closed shop at the end of December after a multi-year fight to stay in the race against rivals Uber and Lyft and their ever-growing war chests and market shares. Though Sidecar was early to the peer-to-peer ride-sharing model, it eventually shifted its business to providing delivery for other companies in 2015. "This is the end of the road for the Sidecar ride and delivery service, but it's by no means the end of the journey for the company," Paul wrote in a blog post about the service's shutdown, hinting that the company already had plans for a next chapter.
Earlier this month, GM revealed a $500 million investment in ride-hailing company Lyft as part of the startup's new $1 billion fundraise. As part of the deal, GM said it plans to eventually deploy self-driving cars it's currently developing into Lyft's fleet, and GM President Daniel Ammann joined Lyft's board of directors.
But GM is reportedly developing its own ride-sharing services, which the company has dubbed Maven, according to the report. On Nov. 25, GM filed an application to trademark the Maven name to the U.S. Patent and Trademarks Office, for an "application software for connecting vehicle drivers and passengers and for coordinating transportation services." The program will let owners of GM vehicles connect with and give rides to other passengers commuting in the same direction, according to the report, and Ammann will head Maven.
GM will also reportedly get a license to a patent granted to Paul in 2002, titled "System and method for determining an efficient transportation route." Over the years, Paul and Sidecar amassed a handful of ride-sharing and ride-hailing patents, though they were never successfully enforced.
GM is only the latest automaker to join the ride-sharing craze. In 2014, Daimler acquired ride-sharing apps RideScout and mytaxi, while BMW has been experimenting with a variety of car-sharing models. Ford was also reportedly testing its own ride-sharing service, it revealed last April.