In another indication of the encroaching mindset of the Millennial on the marketplace, Lyft co-founder and president John Zimmer yesterday told Reuters that the Uber competitor has reached an annualized gross run rate of $1 billion. Meanwhile, the New York Timesreports that Lyft is seeking $500 million in additional financing at a valuation of $4 billion, up from $2.5 billion.
“Lyft has already raised more than $1 billion from investors like the billionaire activist Carl C. Icahn, the venture capital firm Andreessen Horowitz and the hedge fund Coatue Management,” write Leslie Picker and Mike Isaac.
Zimmer went on to tell an opening-day audience at the Los Angeles Auto Show that he not only won’t be getting his daughter a car when she turns 16, he won’t even bother to teach her to drive, reports Andrea Chang in the Los Angeles Times.
“Zimmer predicted that Millennials — who are more focused on experiences such as travel, food and friends over cars — will help usher in a ‘massive shift’ away from car ownership. Less than 70% of 16- to 24-year-olds have a driver's license,” Chang writes.
“This is the new transportation consumer,” Zimmer told reporters and industry professionals in a keynote. “They're telling us the days of traditional car ownership are over. ... This trend will continue to accelerate rapidly.”
First pointing out that Lyft’s share of that $1 billion pie is probably around $200 million — its 20% cut — TechCrunch’s Sarah Buhr and Alex Wilhelm report that Zimmer not only attributes the growth to Millennials moving to large cities like San Francisco and New York and going carless but also to Lyft’s “effort to home in on the mass transit gap in several cities.”
“What we’re finding is across the country, 20% of rides start and stop with public transit and so in a place like Manhattan really being able to communicate how this can be used has been helpful,” Zimmer said.
“Lyft jumped into the NYC market just about a year ago but has tripled its market share in the last four months there, according to Zimmer,” Buhr and Wilhelm report. Lyft introduced its ride-sharing app Lyft Line in areas of Manhattan and Brooklyn in July at a promotional $5 a pop. It raised the rate to $8 last month — a rate it says it still 50% less than the original Lyft.
Meanwhile, the Natural Resources Defense Council and UC Berkeley's Transportation Sustainability Research Center are going to analyze the environmental impact of Uber and Lyft, Laura Bliss reports on CityLab. “The central question is whether these services reduce, or add to, the number of car trips taken in major cities.”
“If you hadn’t just taken a trip using Uber or Lyft, what would you have done instead?” asks Amanda Eaken, deputy director of urban solutions and sustainable communities at NRDC. The study will be nationwide but focus on cities such as San Francisco, Los Angeles, New York, Washington, D.C., and Austin, where pool services such as Lyft Line and UberPool operate.
Meanwhile, both companies are not only battling attempts to regulate their activities brought on by competing taxi companies and municipalities but also by their own “driver-partners,” as Uber would have it.
“Uber is fighting legal battles around the world, some with its own driver-partners, who are seeking the benefits of traditional workers,” writes Mark Harris in The Guardian. “Driver-partners in California have filed a class-action lawsuit for petrol and maintenance expenses, while driver-partners in the UK want paid vacations and minimum wage protection.”
“If you want to start a fight in otherwise polite company, just declare that the ‘sharing economy’ is the new feudalism, or else that it’s the future of work and all the serfs should just get used to it, already,” The Wall Street Journal’s tech columnist Christopher Mims observed in May.
He went on to claim that despite claims to the contrary, Uber, Lyft and other companies operating under this new business model “are remarkably efficient machines for producing near minimum-wage jobs.”
Meanwhile, out in Nevada yesterday, Clark County commission chairman Steve Sisolak was heard to say, “I give up with you guys,” at the end of a hearing to determine if it should enact two ordinances — “one requiring the companies to apply for business licenses and another requiring their independent drivers to do the same,” Daniel Rothberg reports in the Las Vegas Sun.
To the chagrin of the commissioners, the companies have been battling a requirement to provide a list of their drivers so the county can determine if they are licensed. They claim they can do this themselves.