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Ride-hailing service Lyft snags $100 million from Carl Icahn

The new investment could help Lyft better compete with bigger rival Uber in the race to grab people seeking an alternative to traditional taxi service.

Lyft has just picked up $150 million. Lyft

Lyft has scored an investment of $150 million -- $100 million of that courtesy of investor Carl Icahn.

The company, whose ride-hailing app competes with its equivalent at bigger and better-funded Uber, didn't reveal Friday who contributed the other $50 million. However, the San Francisco-based company did pick up $530 million in funding earlier this year from a group led by Japanese e-commerce firm Rakuten.

The $150 million, which brings Lyft's total funding to just over $1 billion, will help the privately held company pay for initiatives designed to expand its service, which is currently in about 60 US metro areas.

Lyft and Uber compete with traditional taxis and limousines as well as each other by contracting with private drivers who use their own vehicles to pick up riders. Customers can use the mobile apps from Lyft or Uber to hail a driver. In battling for customers, the two companies have engaged in price wars and turf battles.

Uber is the more dominant of the two, offering its service in more than 250 metro areas around the world.

Uber is also worth more. It is the second-highest-valued venture-backed company in the world with a valuation of $41.2 billion. Meanwhile, Lyft was valued at $2.5 billion as of March. With its new round of funding, Lyft's valuation is unclear.

With more funding, Lyft plans to add more cities around the US as well as "deepen" its offerings in its current markets. The company also plans to hire more people and expand its Lyft Line service, which lets multiple people going to the same destination share a single ride.

Icahn has been known for investing in technology companies that he believes are undervalued and have the potential to deliver a huge payoff. Icahn, who controls Icahn Enterprises, is also known as an activist investor as he often challenges the leadership of companies by pushing them to make moves that he feels will boost the business and raise the stock price or valuation.

"I believe that ridesharing is poised to become a fundamental component of our transportation infrastructure," Icahn said in a statement Friday. "The company's revenue growth to date has been extremely compelling, and increasing urbanization over the next 5 to 10 years should enable the company to maintain that trajectory. Additionally, I've been very impressed with Lyft's founders and management team, and I believe they are well-suited to take advantage of this opportunity and to make Lyft an extremely successful company."

In exchange for an investment, Icahn usually seeks representation on a company's board of directors. This time is no different. Along with the $100 investment in Lyft, one of Icahn's managing directors, Jonathan Christodoro, will join Lyft's board.

Lyft did not immediately respond to CNET's request for comment.