Feb 13, 2017 · 39m · how-i-built-this
Lyft: John Zimmer
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In this episode of How I Built This, host Guy Raz interviews Lyft co-founder John Zimmer about transforming a campus carpooling project named Zimride into a multi-billion-dollar on-demand ridesharing giant while overcoming regulatory hurdles and intense competition with Uber.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Guy holds 35.4% of the talking time here. How this is scored →
Guy as informed peer 3.2 Guest teaching 2.2 Guest disagreement 0.2 Guy pushing back 0.6
speaking balance: gold is Guy, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 15:59 Zimmer rejects car rental framing
Zimmer politely but directly rejects Guy Raz's assumption that Lyft was about renting out idle parked vehicles, clarifying that it was about driving people.
Hardest push from Guy ▶ 29:00 Raz presses on personal rivalry with UberRaz pushes past generic business competition talk to ask Zimmer if the rivalry and alleged sabotage by Uber felt deeply personal to him.
Biggest teaching moment ▶ 23:27 Zimmer breaks down regulatory safety standardsZimmer educates the listener and host on how Lyft beat existing California limo standards by requiring higher insurance limits and background checks.
Guy holds their own ▶ 33:46 Raz details political dynamics and Uber account deletionsRaz lays out specific figures and context regarding the Trump advisory council backlash, the ACLU donation, and the 200,000 Uber account deletions that boosted Lyft.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Guy as informed peer | Guest teaching | Guest disagreement | Guy pushing back | Why |
|---|---|---|---|---|---|---|
| The Rise of Ridesharing and Zimmer's Early Direction | 4 | 1 | 0 | 0 | Guy Raz sets the narrative stage outlining Lyft's valuation and the rideshare revolution, while John Zimmer shares his early background at Cornell and Lehman Brothers in a collaborative tone. | |
| Logan Green and the Inception of Zimride | 3 | 3 | 0 | 0 | Zimmer explains co-founder Logan Green's background in transit and the inspiration behind Zimride, offering concrete transit operating cost figures to illustrate the broken transit model. | |
| The First Meeting and Partnership in New York | 2 | 1 | 0 | 0 | The dialogue focuses on personal rapport and early marketing tactics, including Zimmer dressing in a beaver costume on campus. | |
| B2B University Expansion and Leaving Wall Street | 3 | 2 | 0 | 1 | Guy clarifies the original university B2B subscription revenue model, and Zimmer explains leaving Lehman shortly before its historic bankruptcy. | |
| The Smartphone Shift and the Birth of Peer-to-Peer Ridesharing | 4 | 4 | 1 | 2 | Raz asks if the initial peer-to-peer idea was renting parked cars out like car rentals; Zimmer gently corrects the premise, explaining it was about peer drivers offering rides and changing social habits around trust. | |
| Mid-Show Teaser and Break | 2 | 2 | 0 | 0 | Zimmer details the initial launch in San Francisco using suggested donations to navigate regulatory gray zones before official framework approval. | |
| Rebranding as Lyft and Divesting Zimride | 3 | 1 | 0 | 0 | Zimmer recounts the 3-week pivot to build Lyft, the naming process due to elevator trademarks, and selling Zimride's assets to Enterprise. | |
| Overcoming Regulatory Battles with the California PUC | 4 | 4 | 0 | 1 | Zimmer details dealing with cease-and-desist orders from the California PUC, highlighting how Lyft exceeded existing taxi insurance and background check standards to create a new regulatory tier. | |
| Rapid Market Expansion and Differentiating from Uber | 3 | 2 | 0 | 1 | Raz presses Zimmer on differentiation from Uber after Uber copied peer-to-peer rides with UberX, prompting Zimmer to explain Lyft's driver-first strategy and in-app tipping. | |
| Core Values, Team Scale, and Competitive Drive | 4 | 3 | 1 | 1 | Raz questions whether autonomous vehicles will make Lyft obsolete; Zimmer counters that autonomy will phase in gradually and support subscription transportation models. | |
| Brand Contrast and Political Shifts with Uber | 3 | 1 | 0 | 0 | Raz summarizes the political contrast between Lyft and Uber during the travel ban protests, followed by the How You Built That segment featuring Jaya Iyer. |
Statements from this episode (17)
Zimmer: Discovered Co-Founder Logan Green Through a Mutual Friend's Facebook Post
“And so I started thinking what else I could do, and it was actually about a year into it that I was on Facebook one night and saw Logan, who is now, now my co-founder, who I didn't know at the time, posted on a mutual friend's Facebook page saying that he was …”
John Zimmer: US bus fares cover only about 30% of operating costs
“Across the country, when you pay to get on the bus, you're really only covering about 30% of the operating cost. So what that means is a three dollar bus fare actually costs the government 10.”
John Zimmer marketed Zimride at Cornell by wearing a beaver costume
“Our, one of our early purchases was a frog and beaver costume that we put on. I went to Cornell. I was actually going to Cornell on a recruiting trip for Lehman, but I went a few days early, and I was standing on the quad in this ridiculous costume handing out…”
Zimride sold private carpool networks to 150 universities and companies
“We were able to, over a few year period, sell to a 150 universities and companies that would pay us an annual fee for this private carpooling network.”
US cars sit parked 96% of the time, costing households $9,000 annually
“The average American household spends over 9000 dollars every year on owning and operating a car. This equates to over two trillion dollars annually in the U.S., and the car sits parked 96% of the time.”
Early Lyft bypassed taxi regulations by relying on optional passenger donations
“It was in the early days. You got to remember, again, one, that this was very, very new and not normal, and you know, I'd say would, was fall, would fall in a regulatory gray area, and so one of the ways that we saw around that was to say to make it optional f…”
Lyft founders sold Zimride assets to Enterprise Rent-A-Car
“So we sold Zimride to Enterprise Rent-A-Car, and basically the assets, the contracts with the universities, and retained the entire team, and went all in on Lyft.”
Zimmer: Lyft takes a 20% to 25% commission on ride fares
“So the rate is calculated based on distance and time, and then Lyft receives a commission off of that 20 to 25% off of the overall rate, the rest goes to the driver, as well as a trust and service fee.”
Lyft received its first government cease-and-desist letter one month after launch
“About a month into launching Lyft, this was in later we received our first of many cease and desist from various different governments and it basically said, you need to stop operating.”
Zimmer: California CPUC required $750k insurance while Lyft provided $1M
“We've gone above and beyond on the background checks, which actually still to this day for, ah, limos in, in California are not required. We've done driving record checks with more strict criteria, and we've created an insurance policy that's a million dollars…”
Zimmer: Lyft launched 24 new markets on April 24, 2014
“Maybe the most intense moment was April 24th, 2014, when we launched 24 markets on the same day.”
Zimmer: Lyft had over 300,000 drivers and grew significantly
“No, we, we've said several months ago that, you know, last year there was over 300,000, and you can assume that this year that number has grown quite significantly.”
Zimmer predicted autonomous cars would gradually handle a growing percentage of rides
“An autonomous car is not going to drop out of the sky and be able to do a hundred percent of our trips. That's not real. What's real is that over the next couple years, it'll be able to do A few percent of our trips, 10% of our trips, 50% of our trips.”
Zimmer predicted Lyft would sell monthly subscriptions mixing human and autonomous rides
“In fact, what you'll be able to do is buy, you know, likely a miles plan from us, a monthly subscription to handle all your transportation needs. And over the next few years, some of those trips will be done by human drivers, and others will be done by autonom…”