Three years ago, The Lyft was slow. The perpetual also-ran to Uber was in danger of being driven off the road entirely. The founders were in charge, and in March 2023, they hired former Microsoft and Amazon executive David Risher to turn things around. The new CEO expanded its service to other countries, made deals with Waymo and Nvidia, reduced ride cancellations, and paid drivers more. Just this week, Lyft announced that customers in New York will also see taxis among their options. The company now reports a profit—but it’s still in second place in ride-sharing, and its stock has fallen this year. I recently spoke with Risher about Lyft’s prospects, his jaundiced view of Uber, and his plans to manage autonomous vehicles for tech companies or citizens.
STEVEN LEVY: Where are you in your transformational career?
DAVID RISHER: When I came in, we were losing share—Lyft had 26 or 27 percent versus the other guy. We were losing money, $300 million a year. Things were not going well. I went to the Jeff Bezos school, so when I came in, all I focused on was customer service. We spent quarter after quarter adjusting our cost situation, to lower prices. We have raised the prices of the drivers, because if the drivers are not paid enough, they tend to get frustrated and do not provide good service, and then they get off the platform. We started inventing again. So today, we have an advantage. We have the highest level of driver satisfaction we’ve ever had, and our passengers keep coming back. And our share has now reached about 31 points.
However your stock is low.
Our analysts and investors like the fact that we are growing quarter after quarter, but they also see uncertainty in the industry.
Thirty-one percent is a distant second. I saw an article the other day, “Is OpenAI On Its Way To Be Lyft?” The story wasn’t even about sharing a ride! What will it take to never see that article again?
That may be a false premise. We do a billion rides a year in North America. Some guys maybe do two. [Uber doesn’t break out numbers geographically but reports around 14 billion rides a year globally.] That’s 3 billion rides between the two of us. But people take 160 billion rides in their private cars every year. So there is a huge market to grow into.
The reason we have gained share over the last few years is because our service is so much better. On average we will take it faster than those guys will. We have reduced driver cancellations. The next category is what we call “Save Money, Check Lyft,” which is based on the basic premise that if you’re a rider and you’re only checking out the other guy, you’re leaving money on the table. If people were checking all the time, we would have more than a 50 percent share. I promise you.
Yesterday my son was on the train, and he needed a ride to the station a few stops down. Uber was $70 and Lyft was $130.
We try to beat them more than we lose, but we have different algorithms, different data. We, religiously, check deeply to make sure that is true.
I often hear from drivers — for both Uber and Lyft — that the companies are taking a big cut. Is that appeal valid?
The short answer is no. Of course in the early days of this industry, there was a lot of sponsorship for drivers, and there are still drivers who remember that or have friends who remember those days. We will never, ever, ever take more than 30 percent after the insurance is issued.
