Uber also palms off its electric bike service Jump to Lime.

The pandemic has unleashed turmoil in urban transportation, and it’s showing up in deal-making. Lime, the electric scooter sharing service that was laid low due to lockdowns and social distancing, has managed to snag $170 million in its eighth round of funding. (VentureBeat)

Uber (NYSE: UBER) led the round. Alphabet (NASDAQ: GOOGL), Alphabet’s VC arm GV, and Bain Capital, among others, also participated.

Valuation details were not revealed, though The Information was the first to report on the possibility of funding at a $510 million valuation. However, Lime confirmed to CNBC that it was lower than its previous round.

People familiar with the matter confided to Bloomberg|Quint that the latest round valued Lime at $510 million – a rather sharp come down from the $2.4 billion Lime commanded in last year’s funding round.

Pandemic and platform problems

The epidemic forced Lime to ground its electric scooters from 99% of its markets around the globe. With no revenues to speak of, the company laid off 13% of its total workforce. The three-year-old company operates in 120 locations in over 30 countries.

Uber too had to suspend its carpool service in March due to the outbreak and had to put its fleet to alternative uses.

A question mark looms on how people will take to urban transportation as lockdowns ease off, and both Uber and Lime have taken out some insurance with the funding. It’s anticipated that people will avoid public transportation and use personal vehicles such as bikes and scooters.

Consolidation the name of the game

As part of the deal, Lime will buy out Jump, the bike, and scooter business owned by Uber. Wayne Ting, Lime’s Global Head of Operations and Strategy, now becomes CEO. Brad Bao continues as Lime Chairman.

Both companies will now further consolidate their apps.

“Micro mobility will be vital to the new world affected by COVID-19 and we are already seeing this as cities begin to move again,” said Ting in a statement. “With our new financing and expanded offerings, we are strongly positioned to meet the needs of riders in a safe and reliable way.”

Post this deal, Uber can focus on its core business of ride-sharing and deliveries, while Lime can get ahead with managing its fleet of scooters and bikes, now bulked up with the addition of Jump.

Uber announces layoffs and financial numbers

On Wednesday, Uber said it will lay off 3,700 employees, or 14% of its workforce. Last month, a report, again by The Information, said the ridesharing company’s bookings had plunged 80% below the year-ago levels.

The company reported a $2.9 billion quarterly loss for the first quarter, driven primarily by losses on its overseas investments.

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