The Exchanges

Q the ride share part of your business is still the core part of your business. What are conversations you're having internally about creating other revenue streams in the future to, you know, if ride share doesn't recover as quickly as you hope or expect, or if, you know, if ride shares is a completely different thing in the future, what, what other kind of places are you looking to diversify?

A Yeah. So, I mean, the, the good news is transportation, uh, is fundamental and is something that through the recovery is going to be important and people will need. So one on, on bikes, you know, we own the system city bike in New York city, Baywheels in the Bay, Divi in Chicago, and you can access them through Lyft. And, uh, for City Bike in New York, I believe it was last weekend, we hit our record of over, over a 100,000 rides in one day. And so we're actually seeing faster recovery and not as deep downside on, on those modes, which has been really helpful. The other area we've looked at is delivery. So we have no intention to be another kind of food delivery consumer app. We will not do that, but there's a lot of small and local businesses That are having to pay 30%, 20% of their revenue to be on those platforms. And so we think there's a huge opportunity to help those small local businesses have their own kind of capabilities and provide more jobs for drivers. So we're experimenting with that. We started that with essential deliveries. We've worked with partners to deliver millions of meals for people in need during this time. Uh, so I think that's another really interesting opportunity on the driver side.

AI assessment note: “The other area we've looked at is delivery.”

Q here's, here's what's interesting about your, I mean, not only is this a complex and regulated, highly regulated industry, but the, the technology is changing so fast, right? Like, In 10 years, we might not even, even be driving cars at all. Maybe 20 years, right? So, how do you, I mean, how do you think about your business model and how it might, how it might evolve over time?

A So, there will be a portfolio of options that we offer you to, say, a subscription. We want to offer you transportation as a service. Instead of spending 9000 dollars a year to own and operate your vehicle, we want to sell you, maybe it's a 500 dollars a month subscription plan. Similar to how you buy minutes, you'll buy a thousand miles. And you'll get access to our bikes and scooters, you'll get access to transit through the partnerships we have with local governments, you'll get access to rides, That is what we're doing. As technology changes, as we add bikes and scooters, it becomes part of that. As we look to autonomous vehicles, it's not the be-all, end-all. It's part of providing that transportation to our customer.

AI assessment note: “We want to offer you transportation as a service.”

Q that was like, hey, I'm going this way, like a, a sort of a car sharing website. Um, like it used to be that you would just advertise on like Craigslist or put something on a pin board and like on college campuses saying driving from, you know, LA to San Francisco, do you need a ride? But he was basically trying to take that concept and put it online.

A Exactly. Yeah. So like you said, we had these Physical bulletin boards or digital bulletin boards for people going along the same way if they're going home for spring break or fall break. Uh, but there was no identity, uh, or ratings behind that, and so it was limited in how many people actually use them. And so we thought, how can we make a safer system? Uh, and you know, if you tied something to a social network like Facebook, you could have a profile of the individual you're going to share a ride with and follow up with ratings. Uh, of, of how that ride experience was, uh, which would create a, a safer and more broadly used environment for, for carpooling on college campuses.

AI assessment note: “Exactly. Yeah. So like you said, we had these Physical bulletin boards”

Q Just like remotely, you were in New York, and he was in Santa Barbara, and you were just, like, emailing and, like, Skyping and stuff all the time?

A Yeah, yeah, we'd have late night Skype, and every, maybe, month or two, we, we'd try to get together. And on, on Logan's end, he's, you know, working on building the website. On my end, I'm figuring out, how do we get enough People using the platform so that it works. It was really like a chicken or egg problem where the idea of having a lot of seats to choose from on your way home from, say, Cornell in upstate New York to go to New York City was exciting. You know, there's very few bus routes. Not everyone owned a car or had a car on campus, and so if I could go on, you know, Zimride Cornell Edition and buy a seat in someone else's car for 20 dollars or 30 dollars, That would be really exciting, but it had to be there, had to be available. We had to create both sides of the marketplace.

AI assessment note: “Yeah, yeah, we'd have late night Skype, and every, maybe, month or two”

Q your heart and soul into the, into Zimride, and then starting Lyft, and watching it turn into a company that's valued over five billion dollars, do you sort of look at that and sort of say to yourself, okay, I can, like, breathe out a sigh of relief, like, we're okay, we've made it, we've gone, we've, we've passed the hump. Or are you constantly worried and vigilant every day?

A Yeah, no, I don't think there's a sigh of accomplishment. I think there's, ah, the bar keeps getting raised, and that's the bar that, that we raise on ourselves. The goal over the last 10 years for Logan and I hasn't changed. You know, it was Zimride, and then it was Lyft, and then it will have autonomous implications. Until we've accomplished the fact that you don't need to own a car in a city, until we've accomplished the fact that we don't need As many roads and parking lots in our cities until we allow for our cities to be, you know, redesigned around the people living in them instead of the cars that are parked in them, then we're not happy.

AI assessment note: “I don't think there's a sigh of accomplishment.”

Q What do you think would have been helpful for you to know, or I guess, what, what would you have done differently?

A Yeah, I mean, it's, it's, it really comes back to the basics of sleep, diet, and exercise, and it's, I don't want to blame external, externalities, like, I myself was putting a lot of pressure on myself, like, I should be working at all hours, and To make this succeed. I have a lot of people depending on me. People have invested in, in the business, and I want them to do well. Uh, I want, you know, drivers and riders to be safe and do well. So it felt, uh, it felt selfish almost to take time for myself, but I think the, the main learning is if I don't do that, if I don't get the, the necessary sleep, uh, exercise and, and, you know, Nutrients. Then I'm not going to be able to better serve all those different populations. So it's really, really basic, but in the storm, uh, hard to see.

AI assessment note: “the main learning is if I don't do that, if I don't get the, the necessary sleep”

Q for Lyft. You had to have some layoffs in May, I think about a thousand layoffs, um, which could not have been easy for you to go through. So as you began to see the pandemic having a significant impact on, on your business, what kinds of conversations were you having with your, your leadership team, with your co-founder Logan about ways to kind of begin to, to build resilience?

A One of the conversations that we've had, or one of the challenges throughout the Uh, is how many different audiences, groups of people that we're working to take care of throughout this, right? So we have our drivers, we have our riders, we have our employees, uh, within employees, there's, uh, those that are working in person, uh, to help drivers at operation centers. And there, there are those that could work from home. So all different populations that we want to take care of, uh, investors as well. Who, who are judging those decisions we make? So I think that's been a really interesting conversation. Also the conversations around short-term thinking versus long-term thinking. There are short-term decisions we need to make in order to preserve the long-term mission that we have as a company. Uh, and those have been really key decisions. You talked about the layoff. That was very, very difficult. It forced us to make hard decisions. Some of which I think actually In hindsight, we're very healthy for the business, but very difficult to make, especially for people that are all in this tough time where, where, where the job market is difficult. Those were not easy decisions.

AI assessment note: “Also the conversations around short-term thinking versus long-term thinking.”

Q in good faith. We can be trusted to Operate as a responsible employer and as a responsible business because the market is going to judge us. Users won't use us if we're not doing that. And that makes sense. But at the same time, you know, we're at a moment now where people have heard that message in the past and haven't seen it, right? They haven't seen or realized.

A I don't think people trust businesses and I don't think that's crazy. I'm not saying trust us. I'm saying let's legislate a solution. That works well for drivers, works well for riders, works well for the business, Works well for labor. You know, the same thing happened in the early days of Lyft when seven, eight years ago, it was wild to get into someone else's car. It was absolutely something that people said would not happen. And we started doing background checks. We started doing driving record checks before there was a rule to do it. And I did used to have that philosophy of, oh, well, look, we're, we're doing it. Uh, you know, trust us. But then I, I learned quickly and I, and I went to the regulator and I said, You know, we received a cease and desist. And I said, look, like, here's what we're doing, but don't take my word for it. Regulate this. And that led to the state law in California, uh, now known as like the TNC category. And that got brought across the country. So I, I agree with you. I think people are fed up listening to not only businesses, but leaders saying, trust me. Uh, and I'm, that's not what I'm saying. I'm saying, listen to the drivers and let's create a new regulation.

AI assessment note: “I'm not saying trust us. I'm saying let's legislate a solution.”

Q How did you, how did you deal with that? Like, how did you deal with that just from a, you know, a stress level?

A It was very hard. I have an amazing co-founder, Logan Green, uh, who's a, who's, we didn't know each other before we started working together. There's a lot of stories of friends who start things together. We started something together and became friends. I have a great wife who is very supportive, but it was, it was very difficult. We woke up one day, it was about four or five years ago, and Uber has raised three billion dollars, and we had a hundred million dollars left in the bank, which is a lot of money, but only a few more months left, and now you have this Crazy competitor who wants to kill you. Um, that, that was definitely, definitely tough, but I think we, we stayed focused on our values. We stayed focused on our, our vision and our mission and, and just put our heads down and executed and tried our best not to get distracted.

AI assessment note: “I have an amazing co-founder... I have a great wife who is very supportive”

Q Like, how much does that drive you, that idea?

A Ah, that's a, I'd say, uh, to, to a large degree. I used to, to play sports, whether it was running track or playing soccer, um, and, you know, I started running track as, just to stay and save for soccer, and then I wanted to, to win the race, and I wanted to go under a five-minute mile, and was able to do that, and so I, I think often now today, you know, we're, we're in, uh, what could be described as a mile. Four laps, And we're in lap two. And, you know, lap three is typically in that race, the most critical lap where you set yourself up for victory. And so, I think we're making a lot of important moves and decisions now that should allow us to, to win the race.

AI assessment note: “I'd say, uh, to, to a large degree.”

Q your heart and soul into the, into Zimride, and then starting Lyft, and watching it turn into a company that's valued over five billion dollars. Do you sort of look at that and sort of say to yourself, okay, I can, like, breathe out a sigh of relief. Like, we're okay. We've made it. We've gone. We've, we've passed the hump. Or are you constantly worried and vigilant every day?

A Yeah, no, I don't think there's a sigh of accomplishment. I think there's, ah, the bar keeps getting raised, and that's the bar that, that we raise on ourselves. The goal over the last 10 years for Logan and I hasn't changed. You know, it was Zimride, and then it was Lyft, and then it will have autonomous implications. Until we've accomplished the fact that you don't need to own a car in a city, until we've accomplished the fact that we don't need As many roads and parking lots in our cities until we allow for our cities to be, you know, redesigned around the people living in them instead of the cars that are parked in them, ah, then we're not happy.

AI assessment note: “I don't think there's a sigh of accomplishment. I think there's, ah, the bar keeps getting raised”

Q How do you differentiate yourself from them? Like, how do you make the case that actually you should go with us and not them?

A Yeah. So our, our focus in the early days was we needed to ensure we solved the two most important things for our customers first, which was reliability. You can get a ride when you want it at the best possible price. Once you have parity on those, and now, now we do, we've built up enough infrastructure, enough, uh, you know, base of driver community that you can get a ride within on average three minutes in these cities. Then it's about the experience. In today's world, By treating drivers better than any other company, the ability to have cashless tips, get paid in the same day, create an environment where drivers are respected by passengers, and that then translates to passengers being treated better than on any other service.

AI assessment note: “By treating drivers better than any other company, the ability to have cashless tips”

Q drivers as W-II employees, not contractors. But as you can imagine... The issue is pretty heated. A lot of people have, are angry on all sides of this. Um, there are drivers who support the initiative, drivers who oppose initiative, consumers who support it and oppose it. So first of all, can you explain from your perspective, why would it be so hard to treat your drivers like part-time employees?

A Well, I think first it's starting with the fact that many of our drivers already have full-time work. The majority, something like 80% of our drivers Maybe in California it's 86% of drivers drive less than 20 hours a week. This is something someone does maybe five hours a week, 10 hours a week. Yes, of course there's people that are doing it 40 hours a week, but the far majority are doing it less. And I think it's important to zoom out and have the nuance part of the conversation, which is what do we want to accomplish? What is the right thing to do here? The right thing to do is to get benefits for drivers depending on how much they work. If you're gonna drive for five hours, For three months to save money for a wedding or for a medical expense, the, the way we're being, you know, forced into employment would, would make that not tenable. And so what we're saying is, okay, so let's look at this new form of work. Let's not ignore that these drivers deserve benefits, but let's have the benefits scale with the amount of work that we do. Uh, and so prop 22 is that middle ground. We're saying here's a better solution that provides healthcare For drivers driving, you know, 15 hours or greater.

AI assessment note: “the way we're being, you know, forced into employment would, would make that not tenable.”

Q in our final moments, because I know a lot of people think that when they launch a business, they really think of the what, you know, what is it that I'm trying to create? We've talked about this before, and I've heard you talk about the why, the why, that the why of what you're launching is much more important than the what. So what do you mean by that?

A Yeah, so there's some revisionist history that, uh, I now like to say the why in Lyft is because, uh, the why behind our work is way more important than the what. The why, that has always been true that the why has been important. The reason is, like, in today's society, we can, there's so many things we can make. Technology is incredible. We can have these computers in our hand that everyone can have, but why? Why are we doing this? So I think there's too much focus on the next You know, often in technology, you have the, the next phone release, and I think there needs to be a much, uh, much more push from all angles on people thinking about why are we doing this, and if we all were to agree on, like, principles of what's important, principles around, you know, for us, equity, sustainability, economic mobility, then, then our what would be better informed.

AI assessment note: “if we all were to agree on... principles around, you know, for us, equity”

Q planners to sketch out plans for what cities will look like with fewer cars. Um, basically, uh, you know, city streets that are designed for more bikes and e-scooters and e-bikes and so on. Um, I mean, it's interesting because, you know, your business model depends on cars and ride shares. So walk me through the thinking behind this and how would that affect your business model in the future?

A Yeah. So if you zoom out and you think about our mission, improve people's lives with the world's best transportation. From the beginning, we looked at the fact that Americans spend 9000 dollars every year owning and operating a car that they use four percent of the time. They spend more money on their car than they do on food than they do on health care. The only thing they spend more money on than their car is their house. And to us, that doesn't make any sense. So we want to create a whole new way for people to access transportation. Because we think by doing that, we can allow cities to be built around people instead of car ownership, right? We have so much parking everywhere. Studies show when you build more streets, you get more traffic. And so, especially in a moment like now, when you can rethink everything or that you're forced to rethink everything, thinking about street design is, is critical. You know, we have, uh, the bikes, as I mentioned, across the country. There would be a lot more people using bikes. If there was safe bike infrastructure, there would be a lot more people walking and enjoying local commerce in cities. If, uh, it was always safe for pedestrians and there was easy access, uh, throughout the city. There is going to be transportation in cars, in vehicles. Uh, that will always be important, but the infrastructure needed, uh, whether that's parking o…

AI assessment note: “we want to create a whole new way for people to access transportation.”

Q And, and where were you, like, handing out flyers?

A Yeah, so, We needed to get a critical mass of let's call it a thousand people offering their seats so that those that went on to look for a seat could find one. And it worked. And at that next day at the Lehman recruiting event, a girl came up to me while I was surrounded by a lot of our managing directors and said, did I see you in a, in a beaver costume yesterday? You know, the next step was, let's sell a private network to the various universities. And, uh, 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.

AI assessment note: “We needed to get a critical mass of let's call it a thousand people”