Lyft

Lyft's new problem: A class action lawsuit

An illustration of a cell phone with a pink background and a white dollar sign
Illustration: Lazaro Gamio/Axios

Lyft last Friday was hit with a class action lawsuit by investors in its IPO, who have seen the value of their shares fall precipitously.

My thought bubble: Normally I ignore such cash grabs, as they reek of sour grapes. But this one, with or without merit, highlights a reason why both Lyft and Uber have struggled since going public.

Direct listings challenge benefits of traditional IPOs for unicorns

Photo: Eric Baradat/AFP/Getty Images

This year's rush of unicorns to the public market is challenging many long-held notions about the stock market, perhaps most notably the idea that companies need pricey investment bankers and other well-paid middlemen to go public.

Why it matters: With a historically low number of companies going public in recent years, investment banks are relying on big deals from billion-dollar companies like Uber, Zoom and Lyft to make their money.