The Exchanges

Q You would push back on me when I say it's a commoditized industry. In terms?

A I, I think it's absolutely not a commoditized industry. If you just look at the results, and the result is that Lime, five, six years ago, Lime was one of many, many, many operators. Today, Lime is the clear global leader, and we are the market leader in almost every market where we operate. Last year, we did over six hundred million dollars in gross bookings. Our four-year top line CAGR is 30%. In each of those four years, we expanded our profit margins. And last year we did over ninety million dollars in company-wide EBITDA. The same year our biggest competitor went to chapter 11. So if it was commoditized, then we would have the same financial results as everybody else, but we've been growing in a differentiated rate and delivering a differentiated bottom line. The proof is in the results.

AI assessment note: “I think it's absolutely not a commoditized industry. If you just look at the results”

Q Can I ask, when you expand into a new market, what does that expansion playbook look like? And can you just break that down for me?

A So I think it starts with talking to local regulators and governments, and I think we started by talking about what I learned in government, and it starts with, we want to be there to solve a problem for the city. And transportation, the biggest challenges in transportation are affordability, congestion, And carbon emissions, and you convince the city to launch a pilot, and there's a competitive RFP process through that pilot, where you maybe do a one-year pilot or a two-year pilot, and they invite multiple players to come and compete in that competitive RFP. And we actually like the competitive RFP process for two main reasons. One is that it actually naturally reduces the number of competitors you have in a city, because the city is not going to pick 20 different players. They're going to pick between one and And three. And the second thing that we like about it is Lime is really, really good at winning competitive RFPs. We have a greater than 90% win rate of competitive RFPs on a global basis, and we, we renew our permits at a greater than 95% rate.

AI assessment note: “it starts with talking to local regulators and governments”

Q Take me to the best. What made the best the best and so efficient from a capital perspective?

A From an operations perspective, the, the, the thing that made, the thing that I think was the biggest difference was the leader of the, of the team, the general manager. We copied Uber's kind of general manager model. We had a distributed decision-making process where each GM in the markets Were the CEOs of their market. They can make decisions about where to invest, how to control their costs. And the biggest difference was where, was the GM, the best markets, the GM knew all the, all the mechanics by name. They were walking the floors. I remember I went to the worst market and I sat there for eight hours. I was doing my emails, sitting in the middle of the warehouse and I was just watching what everyone was doing. And eight hours later, I walked out. I was like, I figured it out. And I went to the GM of that market. It was in Southern France. I was like, in the eight hours I sat there and you know, I'm here. You never came in one time. You never, you never walked around the floor. And then that guy over there has been fixing the same scooter for eight hours. He doesn't know what he's doing at all. He is just wasting time. And the fact that you haven't walked up to him and asked why he's spending so much time on a single scooter. He's just screwing that one screw and unscrewing that same screw. Great operations requires a hands-on approach. You got to know what's happening to …

AI assessment note: “quality of the leader was the biggest differentiator”

Q think a lot of VCs followed it a little bit too much. And when I think about VCs following things too much, I think about kind of hype cycles and frenzies in funding environments. And it was a, Incredibly heated environment that you're in, being bluntly the scooter environment and the micro mobility environment. How do you oscillate or reflect on VC hype funding environments and think about them today?

A I would say these hype cycles are generally bad for companies because it, it allows them to avoid learning hard lessons. I feel like Lime couldn't really assert our leadership in the industry until VCs kind of moved on. Because if you could always raise money, even if your results are bad, It masks your bad operations, and it actually also masks a better business because you can always raise more money to then plow it back into growth, into discounts, and you can discount your way to a lot of market share. One of the things that I'm very proud of with Lime's financial results is that we've been able to sustain 30% growth, 30% top line growth over four years, top line CAGR, but each of the last four years we expanded our margins Which means that we weren't just growing by irrationally discounting, but if you have unlimited venture capital and more to come down the road, then you can start acting in ways that are not focused on building a good long-term business, but instead focused on the short term. And I felt that's much harder to compete with an irrational competitor with unlimited funding. But when all of the VCs moved on and it was hard to raise money, that's when focusing on great operations, great hardware, great government relations, That's when those investments actually started paying dividends. So I'm actually, I think being in a hype cycle is actually bad for startup…

AI assessment note: “these hype cycles are generally bad for companies because it, it allows them”

Q Dude, it's insane. Um, but I, I, do you think it's because, and you have to choose one here, do you think it's because you've mastered unit economic efficient maintenance growth that you became profitable and you won? Or do you think it's because Of the little things that delivered a better consumer experience, if you had to choose which one?

A I think both are super important, but I think the incremental operational improvements that allowed us to generate profits over, over the last five years is probably more important than the incremental rider experience. But I, I do think, ah, profits didn't allow us to invest more in more capital expenditure, to build a bigger fleet, to invest more in our software. And our hardware. And this matters because reliability is the most important thing in transportation. You're going to pick the platform that is more reliable. Here, you mentioned when you walk out of your apartment, your flat, you can always get a line. That allows you to give up your car and transition, hopefully, your transportation into micromobility. But if you walk out of your apartment, when you need transportation, you can't get it. It's very, very hard for you to To, to give up your car and to ride bikes mostly. So reliability is crucial. This is why when we increase our fleet in a market, we actually see our trips per vehicle per day go up. Our utilization goes up. It's counterintuitive. When you grow your supply in most businesses, the utilization per unit goes down because the demand usually doesn't go up faster than your supply. But our industry, we see the opposite. As we grow our supply, our utilization on a unit basis goes up because more people now can reliably choose Lime as their transportation defa…

AI assessment note: “operational improvements that allowed us to generate profits... is probably more important”

Q Ok, so we're expanding rapidly in Europe. We're doing scooters. Great. How was the business at that point for you coming in? When you think about your experience there, what were the biggest challenges for you coming into Lime at that point?

A I think that the biggest challenge was that the business was upside down at that point. I remember digging into the P&L of the business. I think we were losing three dollars for every dollar of revenue, and the biggest thing was the hardware. The, the, the industry had taken Personally use scooters and put it into a commercial space, and so these were not designed for commercial use at the time. This is six years ago, and I think the average scooter only lasted 30 days. The daily decay rate was three percent, so in the course of 30 days your entire fleet was gone, and you can't run a business that is a hardware capex intensive business if every 30 days you need to buy a whole new fleet. So the business was completely upside down, and I thought we didn't have great data Either. Like, one of the most, one of the first things I was really keen on doing was we got to establish ground truth. What was even happening? Because I remember I was meeting with the head of Europe when I first joined, and he was telling me how profitable he was, and I was like, it doesn't seem like it from what I can see, but the fact that he didn't know if they were profitable or not is a failure of the company, because we need to give him real accurate data so that he can make the right decisions. If he thinks he is printing money when the opposite is true, Then we have not set him up for success. So I spe…

AI assessment note: “the biggest challenge was that the business was upside down at that point.”

Q What did you do when you saw that, Wayne? You're an incredibly data-driven, analytical, smart guy. You're like,

A I remember my, I had two thoughts. One thought was, did I make a terrible mistake? Because I don't think I fully understood how upside down the economics of the industry were. And the second was, I need to get out there to really understand what was happening. So I then spent the next three months traveling to warehouse after warehouse. I probably visited a hundred warehouses, and I would just sit in the warehouse and watch what people were doing. I went to the best warehouse, and I went to the worst warehouse, and I spent the most amount of time Sitting in the worst warehouses and just watching people try and understand why is it that we couldn't make money? Like, what are we doing incorrectly?

AI assessment note: “I then spent the next three months traveling to warehouse after warehouse.”

Q Take me to the best. What made the best the best and so efficient from a capital perspective?

A From an operations perspective, the, the, the thing that made, the thing that I think was the biggest difference was the leader of the, of the team, the general manager. We copied Uber's kind of general manager model. We had a distributed decision-making process where each GM in the markets Were the CEOs of their market. They can make decisions about where to invest, how to control their costs. And the biggest difference was where, was the GM, the best markets, the GM knew all the, all the mechanics by name. They were walking the floors. I remember I went to the worst market and I sat there for eight hours. I was doing my emails, sitting in the middle of the warehouse and I was just watching what everyone was doing. And eight hours later, I walked out. I was like, I figured it out. And I went to the GM of that market. It was in Southern France. I was like, in the eight hours I sat there and you know, I'm here. You never came in one time. You never, you never walked around the floor. And then that guy over there has been fixing the same scooter for eight hours. He doesn't know what he's doing at all. He is just wasting time. And the fact that you haven't walked up to him and asked why he's spending so much time on a single scooter. He's just screwing that one screw and unscrewing that same screw. Great operations requires a hands-on approach. You got to know what's happening to …

AI assessment note: “the thing that I think was the biggest difference was the leader of the team”

Q Can I ask, when you expand into a new market, what does that expansion playbook look like? And can you just break that down for me?

A So I think it starts with talking to local regulators and governments, and I think we started by talking about what I learned in government, and it starts with, we want to be there to solve a problem for the city. And transportation, the biggest challenges in transportation are affordability, congestion, And carbon emissions, and you convince the city to launch a pilot, and there's a competitive RFP process through that pilot, where you maybe do a one-year pilot or a two-year pilot, and they invite multiple players to come and compete in that competitive RFP. And we actually like the competitive RFP process for two main reasons. One is that it actually naturally reduces the number of competitors you have in a city, because the city is not going to pick 20 different players. They're going to pick between one and And three. And the second thing that we like about it is Lime is really, really good at winning competitive RFPs. We have a greater than 90% win rate of competitive RFPs on a global basis, and we, we renew our permits at a greater than 95% rate.

AI assessment note: “it starts with talking to local regulators and governments”

Q coach who talks about improving one percent and everything is a game of inches. I absolutely love that. When talking about the one percent, one thing that's not one percent is COVID. I spoke to Jeff Jordan. I spoke to Sarah before. They were like, Obviously, the business fell off a frickin cliff. Can you just take me to COVID? You were just CEO at that point. How was it?

A So we started, like, every company builds a budget and a plan for the year. In twenty-twenty, we had our budget, we had our plan, but nobody builds a plan where your revenues fall 90, 95% in a matter of days, which is what happened in the early weeks of COVID. We knew going into twenty-twenty, we needed to go raise more money, but Suddenly what we thought was maybe six months of runway was like, like, 20 days of runway because all of our revenues went away. You still have a lot of your costs. You have warehouse costs. You have employees on the, on the, on the payroll. So suddenly you had all these costs and then your revenue went away completely. And we needed to raise emergency funding to get through COVID at a moment where I would say transportation is so much was unknown in the beginning of 20 20 and transportation was not the sexiest place to put your money going into COVID given all the uncertainty. This is also where I would really give Dara a lot of credit because we went to Uber and Uber at the time Owned and operated their own micro-mobility business called Jump. And, and I pitched them, I pitched Dara this idea of letting them sell, sell Jump to us so we can then, we can bring the two businesses together, take out costs, and then we can be the micro-mobility option on Uber. And to Dara's credit, he, I think going back to like really believing in the people that he men…

AI assessment note: “nobody builds a plan where your revenues fall 90, 95% in a matter of days”

Q Can I ask a final one? I hope it's okay to be personal. Um, Blake said that I should ask about it, so I hope it is, but we can add it out if not. Um, he said that, you know, you suffer from a stroke. Um, how did that impact you, how you lead, how you think as a leader? I'm just really interested by that.

A Harry, first, thank you for asking that. I actually, I've been pretty public about having had a stroke earlier this year, in part because when I was in the hospital recovering, I was like Googling around trying to find CEOs who've gone through something similar. And what was surprising to me was I found not a ton of examples of CEOs talking about health struggles. I think part of it is that when you do kind of a podcast where you do media, you want to put your best foot forward, whatever that means. And that doesn't mean talking about where people are struggling. And so I remember when I couldn't find a ton of examples, I remember thinking to myself, I need to go out there and talk about my health struggles more publicly. So it's less of a taboo. I do think this has been the hardest year of my life on a personal basis. I think the hardest thing is that When you suffer a stroke, like, I still can't move my left arm and my left hand. There's a lot of, like, physical, neurological ailments that you're struggling to get through, and I still remember the person I was and the person that I still see myself as, but the person I am today sometimes doesn't, isn't matching kind of my own self-perception. So I feel like a lot of my days are filled with disappointment, disappointment in myself, disappointment in how I, how I perform. I've really enjoyed this conversation with you, Harry, b…

AI assessment note: “I still can't move my left arm and my left hand.”

Q Can we just stay on that one? Because we could have trips per vehicle per day, and that can be very high, but in very short trips, and so not as much money, or it could be very long. So, how do you think about the right metric to choose in that regard?

A Ultimately, you want to be generating more revenue than your costs, and so we were looking at the economics also on a trip basis. So if I think about total revenue, it's the number of fleet, total fleet multiplied by revenue per fleet multiplied by trips per vehicle per day gets me to total trips multiplied by revenue per trip gets me to total revenue. And so you don't, what you had was a lot of short trips. So low RPT, low revenue per trip trip, and that was insufficient to generate a profit. And that's not a good business. And then you want to make sure you have the right cost metrics. And the biggest cost metrics at the time was simply how long our scooters lasted. So we were very keenly focused on daily decay rate. Now we look at decay on an analyzed basis, but at the time we were focused on how many scooters that we lose today. Because we were losing so many scooters.

AI assessment note: “we were looking at the economics also on a trip basis.”

Q You would push back on me when I say it's a commoditized industry. In terms?

A I, I think it's absolutely not a commoditized industry. If you just look at the results, and the result is that Lime, five, six years ago, Lime was one of many, many, many operators. Today, Lime is the clear global leader, and we are the market leader in almost every market where we operate. Last year, we did over six hundred million dollars in gross bookings. Our four-year top line CAGR is 30%. In each of those four years, we expanded our profit margins. And last year we did over ninety million dollars in company-wide EBITDA. The same year our biggest competitor went to chapter 11. So if it was commoditized, then we would have the same financial results as everybody else, but we've been growing in a differentiated rate and delivering a differentiated bottom line. The proof is in the results.

AI assessment note: “if it was commoditized, then we would have the same financial results as everybody else”

Q Can I ask you, what have you noticed in terms of payback periods on new city launches and how has it changed over time?

A That's a great question, Harry. So when, when I started, the payback was never, because we were, the scooters didn't last long enough to pay back the scooter or the bike. By building, investing in our own hardware, focusing in on these game of inches, micro improvements. We want to be one percent better at everything we do, and when you do a thousand things one percent better, you now have a very different, um, business than all your competitors. So we, when we deploy, and this is pretty consistent in big cities, small cities all around the world. When we deploy our hardware, we can pay back within the first year, and it lasts for more than five years from the 30 days I was describing before. So you have four more years of, of, of cash flow generation after you've paid back your hardware.

AI assessment note: “we can pay back within the first year, and it lasts for more than five”

Q Fascinating. Why don't you do it yourself? I'm just intrigued on the vertical integration. You know, Bundy, you make the frickin' scooters yourself. They're designed, manufactured, owned by you. Why not own actually the battery replacement supply chain as well?

A We do in the sense that all of the battery swapping operations is controlled by our software, which we build in house. Some of our competitors franchise the whole thing and really leave it up to the mom and pops kind of logistics partners to do what they need. But we have great software that dictates how an operator moves around a city, where they go next. All of our tasks within the software is automatically created. So I'll give you an example, which is We also do a lot of move tasks in a city. So we have a machine learning demand algorithm that predicts where we think trips are going to come from in all the cities we're in by the block, by the half block. So in the next six hours, we can say, we think this block will do this many trips or the next 12 hours will have this much demand. And if there is a position of our scooter or bike where we believe by moving it to a higher revenue potential position, If that incremental revenue is more than the cost that we will have paid to move that scooter or bike, it creates an automatic move task in our system. And then so how an operator, how they move around a city, what they do next is controlled by the software. So we, so we do feel like in many ways it is our operations.

AI assessment note: “We do in the sense that all of the battery swapping operations is controlled”

Q Can I be a little bit contrary? Are you sure? Because Marcus at Bolt very clearly said they were the only ones.

A So, you're right. I actually, first I want to say enormous respect for Marcus. Marcus actually, Marcus is developing their own hardware. See, he and I caught up recently. I was surprised that he was developing his own hardware. But to his credit, I believe they are doing it. I trust, I trust he's telling the truth. So, so both, both may be the other player that's developing their own hardware. The challenge with buying off the shelf is that, Harry, if my business is to sell you more scooters and parts, I'm not so incentivized to make the decay rate low. Make it more efficient, because the better my scooters are, the less money I make. There is a disincentive for off-the-shelf hardware manufacturers to make their hardware better, and the longevity and decay rate of the hardware is the key unlock to profitability in this business.

AI assessment note: “So, you're right. I actually, first I want to say enormous respect for Marcus.”

Q told you, listen, I come out of my apartment every day, and there's like, 50 limes in front of my house. Um, so I think of you every day in the most romantic of senses. Um, I want to start, though, you then worked for Dara at Uber, who has had the most incredible journey with Uber over the last years. What did you learn from Dara through his mentorship?

A Dara also, Dara came into Uber at a very difficult transition, and I think what was really amazing was how quickly he reset the tone at the top. I remember one of the first things he did was he wanted to put out new values for Uber. There was a lot of criticisms about kind of the way Uber was acting or the way Uber was competing. And I remember the one value that he put out that was, that resonated the most was do the right thing. It sounds cliche and shallow, but I can't tell you how much it resonated with people all throughout the company. We don't, winning is not enough. We win while doing the right thing. We win while doing the ethical thing. We win while treating each other with respect. And what I saw was that there was, there was different paths to success, and Dara brought a very unique set of leadership traits that in many ways challenged Uber to think about how, how can we be a better company and a better team?

AI assessment note: “what I saw was that there was, there was different paths to success”

Q Is there anything you'd do differently having been through layoffs now?

A Never promise people this is, this is the only round because you never know because you're the, you're, you're doing that as a way to save the company, to bring the cost in line with the revenue expectations. If the world gets worse, if your revenue expectation gets worse, then you likely need to bring your costs down even further. So unless you are 100% sure you can make that promise, don't promise people you're not going to have, this is the only round of layoffs. And I see that happening with friends and like CEOs all the time. They, they promise and then they have to go break their word. When you break your word, then people start questioning other decisions that you have.

AI assessment note: “Never promise people this is, this is the only round”

Q You mentioned down round there. That is a poisonous word to most founders ears. Do you think that we overestimate the negatives of down rounds?

A I do. I think any CEO, any founder cannot use down round willy nilly because investors have believed in you, invested in you, and down rounds are very, very destructive for your, your investor base. And, and when you lose that trust, it's hard to get it back. But I would also say, like, when I see companies sometimes unwilling to raise a round because it's going to be lower than this, like, fictitious number they have in their own head. I see this with, like, IPOs now, where, like, companies are like, oh, well, I can't go public unless I hit the valuation I had in 2020, and that valuation is fake. And so you're making a rational business decisions because you're trying to hold on to a dream, a pipe dream that never should have happened in the first place. I think it's important to not be, not be so keyed in on a value on a valuation. Unless you believe that valuation is justified in today's world and whether or not you should raise and on what valuation is, if there's a marketplace out there, if every VC is telling you, I'm willing to give you money at this lower valuation, that may just be the reality you face. And I think as CEOs, as managers, facing reality is super important. Living in fantasy always results in worse business outcomes.

AI assessment note: “I do. I think any CEO, any founder cannot use down round willy nilly”

Q in a multi-participant economy? And what I mean by that is, if we think about, say, Uber in that case, raising prices, It's doing the right thing maybe for supply and demand. It may be doing the right thing for drivers. It's not doing the right thing for consumers. And so doing the right thing is always held in the context of the beholder. How do you think about that?

A We have a similar debate here. I would say it's really important not to make business decisions, moral decisions. I would actually take pricing out of a moral context. Companies throughout the world raise prices, lower prices, millions of times a day. Amazon probably does it a million times in one day, just on their own platform. Raising prices, lowering prices is not a moral decision. It's a business judgment call. And I think when we bring moral dimensions to business judgment calls, we actually shut down debate prematurely. Because if I'm saying I'm not going to raise prices because I'm doing the right thing, then that assumes the person arguing for raising prices is doing the wrong thing. So it's very dangerous, I think, to, to, to put in moral consequences into a regular business decision. And so I think there are good arguments for why companies may need to raise prices.

AI assessment note: “I would actually take pricing out of a moral context.”

Q Can we just stay on that one? Because we could have trips per vehicle per day, and that can be very high, but in very short trips, and so not as much money, or it could be very long. So, how do you think about the right metric to choose in that regard?

A Ultimately, you want to be generating more revenue than your costs, and so we were looking at the economics also on a trip basis. So if I think about total revenue, it's the number of fleet, total fleet multiplied by revenue per fleet multiplied by trips per vehicle per day gets me to total trips multiplied by revenue per trip gets me to total revenue. And so you don't, what you had was a lot of short trips. So low RPT, low revenue per trip trip, and that was insufficient to generate a profit. And that's not a good business. And then you want to make sure you have the right cost metrics. And the biggest cost metrics at the time was simply how long our scooters lasted. So we were very keenly focused on daily decay rate. Now we look at decay on an analyzed basis, but at the time we were focused on how many scooters that we lose today. Because we were losing so many scooters.

AI assessment note: “we were looking at the economics also on a trip basis”

Q That's insane. To what extent is that actually realistic with advancements in technology? And what I mean by that is will consumer demand get used to newer types, faster types, more comfortable types, and actually you'll just need to upgrade them sooner than that because of consumer demand?

A Maybe. We, we, we've been historically upgrading our fleet more frequently because I think that the, the, each upgrade was a big jump in improvement. So only our gen four scooters and bikes, which is what we have in London, was a big improvement over our gen three. And it was actually allowed us to have a breakthrough in our, in our P and L. But today, I think the quality of our gen four is good enough where I believe we can operate the gen fours for much longer than we've done the gen three and gen 2.5 in the past. So my, my expectation is we're not going to have to upgrade our hardware at the same frequency as we've done in the past. And because they're pretty high quality, riders are willing to, to, to stay with it for longer.

AI assessment note: “riders are willing to, to, to stay with it for longer.”

Q Do you have to be number one in a city for the business to be in our overriding success?

A It's a winner take most market dynamics. So being number one has a lot of advantages. Going back to the point about reliability. So, and ride your, as a customer, you want to be on the platform with the most number of drivers. And the drivers want to be on the platform with most number of riders. So when you are the number one platform on reliability, You suddenly gain a bunch of market share because that reliability is a positive flywheel. More drivers want to be on the number one platform. More riders won't be on the number one platform. That then further improves the reliability of the system, which then draws more customer in. Similar dynamics exist in micromobility because scale gives you more data. We talked about kind of demand forecasting. We have more data to then build better supply positioning, better demand forecasting tools. The more cities we win, the more Lime is the obvious choice for other cities to pick when they're thinking about which operators to go with. Every city wants to know you're bringing the best and latest technology. Lime is the only operator, scaled operator today, that develops our own hardware in house. Everybody else buys from the same Chinese manufacturers.

AI assessment note: “It's a winner take most market dynamics. So being number one has a lot of advantages.”

Q People start questioning other decisions you have. Absolutely. They less so do when you're a founder, I feel, and I'm intrigued in your thoughts on founder mode. We saw Paul Graham be very, um, effective in expelling his thoughts on founder mode and the benefits of it. How do you feel about founder mode given the context?

A So I, I read Paul's, um, blog. I feel like he was describing just good management hygiene, and, but then he called it founder mode. I feel like digging into details, making sure you're, you're, you trust, but you verify is what all good CEOs must do. I think the reason why I thought it was crucial to start my tenure by traveling the world and seeing warehouse up close is that I can't, I can't trust. If Harry tells me everything's going well, And XYZ city, but the results are terrible. Going there and seeing and double clicking and making sure that people, people know that you're somebody who will dig into the details is crucial to driving the results that you want. But at the same time, I think delegation, like making sure you hire great people and delegating and giving them the wrong way to run is also, I think, not a, not a higher management specific trait. I think great founders who make the transition Um, and stay with the company, oftentimes employ the same tactics. I think Paul was describing good ways to manage a company, but then he, but then he assigned, these are what founders do. These are what hired managers do. And I just don't know if that's necessarily true.

AI assessment note: “I feel like he was describing just good management hygiene, and, but then he called it founder mode.”

Q How does that change your mindset as a CEO? You're now no longer at the whim of someone else. You don't have a begging bowl.

A It is the biggest change in mindset. I would say my first four years as CEO, I was constantly worried about Lime going out of business, even as we kind of got out of the, uh, the pandemic. And I remember I would wake up in the middle of the night, just worried about the company because I felt so responsible. All of the people who stayed at Lime, who believed in me, gave me a chance. I felt enormously responsible to them. Enormous, like debt of gratitude to the employees, especially, but certainly to the investors who believed, who invested in Lime, to Dara, to Uber. And this feeling like, oh, we could fail at any time. Just wait on me. Wait on me all the time. I never slept well. I was always waking up in the middle of the night, worried about A or B. I would go, I would go, I would fall asleep dreaming about Lyme and everything that could go wrong with Lyme. Number one, we got to self-sustaining free cash flow positive. It was the first time in many years where I stopped dreaming about Lyme. I dream about Lyme now, but in a good ways. Not, not in, not in worrying about we're going to be out of business.

AI assessment note: “It is the biggest change in mindset. I would say my first four years”

Q in a multi-participant economy? And what I mean by that is, if we think about, say, Uber in that case, raising prices, It's doing the right thing maybe for supply and demand. It may be doing the right thing for drivers. It's not doing the right thing for consumers. And so doing the right thing is always held in the context of the beholder. How do you think about that?

A We have a similar debate here. I would say it's really important not to make business decisions, moral decisions. I would actually take pricing out of a moral context. Companies throughout the world raise prices, lower prices, millions of times a day. Amazon probably does it a million times in one day, just on their own platform. Raising prices, lowering prices is not a moral decision. It's a business judgment call. And I think when we bring moral dimensions to business judgment calls, we actually shut down debate prematurely. Because if I'm saying I'm not going to raise prices because I'm doing the right thing, then that assumes the person arguing for raising prices is doing the wrong thing. So it's very dangerous, I think, to, to, to put in moral consequences into a regular business decision. And so I think there are good arguments for why companies may need to raise prices.

AI assessment note: “I would say it's really important not to make business decisions, moral decisions.”

Q Do you have to be number one in a city for the business to be in our overriding success?

A It's a winner take most market dynamics. So being number one has a lot of advantages. Going back to the point about reliability. So, and ride your, as a customer, you want to be on the platform with the most number of drivers. And the drivers want to be on the platform with most number of riders. So when you are the number one platform on reliability, You suddenly gain a bunch of market share because that reliability is a positive flywheel. More drivers want to be on the number one platform. More riders won't be on the number one platform. That then further improves the reliability of the system, which then draws more customer in. Similar dynamics exist in micromobility because scale gives you more data. We talked about kind of demand forecasting. We have more data to then build better supply positioning, better demand forecasting tools. The more cities we win, the more Lime is the obvious choice for other cities to pick when they're thinking about which operators to go with. Every city wants to know you're bringing the best and latest technology. Lime is the only operator, scaled operator today, that develops our own hardware in house. Everybody else buys from the same Chinese manufacturers.

AI assessment note: “It's a winner take most market dynamics. So being number one has a lot of advantages.”

Q Is there anything you'd do differently having been through layoffs now?

A Never promise people this is, this is the only round because you never know because you're the, you're, you're doing that as a way to save the company, to bring the cost in line with the revenue expectations. If the world gets worse, if your revenue expectation gets worse, then you likely need to bring your costs down even further. So unless you are 100% sure you can make that promise, don't promise people you're not going to have, this is the only round of layoffs. And I see that happening with friends and like CEOs all the time. They, they promise and then they have to go break their word. When you break your word, then people start questioning other decisions that you have.

AI assessment note: “Never promise people this is, this is the only round because you never know”

Q You mentioned down round there. That is a poisonous word to most founders ears. Do you think that we overestimate the negatives of down rounds?

A I do. I think any CEO, any founder cannot use down round willy nilly because investors have believed in you, invested in you, and down rounds are very, very destructive for your, your investor base. And, and when you lose that trust, it's hard to get it back. But I would also say, like, when I see companies sometimes unwilling to raise a round because it's going to be lower than this, like, fictitious number they have in their own head. I see this with, like, IPOs now, where, like, companies are like, oh, well, I can't go public unless I hit the valuation I had in 2020, and that valuation is fake. And so you're making a rational business decisions because you're trying to hold on to a dream, a pipe dream that never should have happened in the first place. I think it's important to not be, not be so keyed in on a value on a valuation. Unless you believe that valuation is justified in today's world and whether or not you should raise and on what valuation is, if there's a marketplace out there, if every VC is telling you, I'm willing to give you money at this lower valuation, that may just be the reality you face. And I think as CEOs, as managers, facing reality is super important. Living in fantasy always results in worse business outcomes.

AI assessment note: “I do. I think any CEO, any founder cannot use down round willy nilly”

Q That's insane. To what extent is that actually realistic with advancements in technology? And what I mean by that is will consumer demand get used to newer types, faster types, more comfortable types, and actually you'll just need to upgrade them sooner than that because of consumer demand?

A Maybe. We, we, we've been historically upgrading our fleet more frequently because I think that the, the, each upgrade was a big jump in improvement. So only our gen four scooters and bikes, which is what we have in London, was a big improvement over our gen three. And it was actually allowed us to have a breakthrough in our, in our P and L. But today, I think the quality of our gen four is good enough where I believe we can operate the gen fours for much longer than we've done the gen three and gen 2.5 in the past. So my, my expectation is we're not going to have to upgrade our hardware at the same frequency as we've done in the past. And because they're pretty high quality, riders are willing to, to, to stay with it for longer.

AI assessment note: “riders are willing to, to, to stay with it for longer.”