Ride sharing firm Lyft Inc. is planning to boost the price range of its initial public offering as investors scramble to grab a share of the promising company.

Reuters reported that Lyft, which competes against the much larger and also IPO-bound Uber Technologies Inc. has decided to raise its IPO price range to $70 to $72 per share, up from an original range of $62 to $68, which brings its target valuation to $24.3 billion including existing restricted stock grants. The increased price range is said to be the result of accommodating investors who don’t want to miss out on what will be the largest U.S. IPO since Snap Inc. went public in 2017.

Lyft embarked on an investor roadshow last week that saw company officials meet with prospective investors from across the U.S. The IPO was oversubscribed just two days into the roadshow, Reuters reported.

The upper end of the price range would see Lyft’s market capitalization hit $20.45 billion, which is slightly larger than Snap’s market cap when it launched its IPO. That would make Lyft’s offering the biggest U.S. IPO since Alibaba Group Holding Ltd. in 2014. At the midpoint of the target range, Lyft would raise about $2.1 billion.

When adding restricted stock options, Lyft’s valuation would top $24.3 billion. The company was previously valued at $15 billion following its last private funding round in 2018.

Lyft’s increased price range suggests that investors are willing to overlook concerns about the company’s profitability. Lyft, like Uber, has bled money since its inception. The company pulled in revenue of $2.16 billion in 2018 but it still posted an overall loss of $911 million.

Still, investors are keen to get in on what should be one of the biggest technology IPOs, alongside the public debuts of Uber and Pinterest Inc., which are also eyeing stock market debuts later this year. Reuters reports that there’s a “backlog of demand” to allocate money to “high growth” stocks as investors look to diversify away from traditional tech giants such as Apple Inc., Amazon.com Inc. and Google LLC.

“There’s a lot of capital waiting to get invested, and that certainly helps Lyft to raise the target price,” said Holger Mueller, principal analyst and vice president of Constellation Research Inc. “But that doesn’t change its general business model, which has questionable alleys to profitability. But it could all work out and [investors] could be rewarded handsomely.”

Muelle said that Uber would also be watching the IPO with great interest, since its own stock debut is likely to mirror that of Lyft’s. “Uber has significantly more scale and global market access then Lyft has, so the higher Lyft can go, the higher Uber will go,” he said.

Lyft is scheduled to set its official IPO price range on Thursday, with trading on the Nasdaq stock exchange to begin on Friday.

Image: Lyft/Facebook