The Information's TITV
00:11:13 · Paul Kedrosky, Akash Pasricha, David Risher, Ashraf Alkarmi
[00:11:13] S1: On premises. Everything gets pushed on premises because they're getting huge pressure from their customers to do AI on premises. So you start seeing these hybridized cloud models of saying, you know, it doesn't have to happen just in our cloud. It can happen on your premises. So it'd glad to talk about, you know, confidential data and secure computing and blah blah blah, all this geekery. But the bottom line is it's a response to this pressure that they need to find... Corporations need to find efficiency gains, large language models will try and do it by saying, hey. We can do that hybrid or on premises. And so that's gonna be, like, the litany for the next twelve months. [00:11:41] S0: Great. Well, Paul, wanna thank you for coming on. That is Paul Kedrosky, general partner at SK Ventures here on TITV. Lyft reported quarterly results this week. Revenue growth decelerated to 8%, down from 16% last quarter, but the company's free cash flow notched up 6%. I want to bring on CEO David Risher for a conversation. David, welcome to the show. It's great to have you here. [00:12:04] S3: It's great to be here. [00:12:06] S0: Okay, David. So I gotta ask you that that... One of the first lines in your release from last night was neither rain nor heat nor the gloom of night can slow Lyft's business, which I didn't know that it seems to be a nod to the USPS [00:12:20] S4: That is correct.
00:12:20 · Ashraf Alkarmi, Akash Pasricha, David Risher
[00:12:20] S4: That is correct. [00:12:21] S0: Postal system. The only thing was that the business did slow, and and the growth rate was about half of what it was last quarter. So I mean, help me understand how you see this. [00:12:30] S3: Yeah, so we measure our business and run our business based on really two key metrics, the bookings growth and then EBITDA growth. And bookings actually were up 17% versus last year. So we actually [00:12:42] S0: said That was a deceleration as well, right? [00:12:45] S3: Well, no, rides are accelerating quarter after quarter and bookings are accelerating quarter after quarter. I don't actually think so, no. I think we've got acceleration on the top and bottom line. But anyway, the real point is that like we've had all time active high riders, all time active rides high. So quarter by quarter stuff kind of bounces around, and there was a big one time settlement that we had this last quarter, which showed up in revenue to your point. But if you look at kind of the trend of our business, particularly where it was a couple of years ago, it is a completely different company, which is kind of an exciting place to be.
00:12:45 · David Risher, Akash Pasricha
[00:12:45] S3: Well, no, rides are accelerating quarter after quarter and bookings are accelerating quarter after quarter. I don't actually think so, no. I think we've got acceleration on the top and bottom line. But anyway, the real point is that like we've had all time active high riders, all time active rides high. So quarter by quarter stuff kind of bounces around, and there was a big one time settlement that we had this last quarter, which showed up in revenue to your point. But if you look at kind of the trend of our business, particularly where it was a couple of years ago, it is a completely different company, which is kind of an exciting place to be. [00:13:15] S0: Okay. So look, I want to talk about some of the strategic initiatives that you announced. So the most interesting was the Lyft Go subscription. And this is $10, You get DashPass, 8% cashback kind of interest. I mean, look, I think the broader question... We can dig into sort of the economics of this, but I was sort of thinking about how many subscriptions people already pay for. Why do you think they're going to pay for another one for Lyft here?
00:13:46 · David Risher
[00:13:46] S3: Yeah. So we designed... The thing that our kind of focus has been over the last three and a half years or so since I've been here is customer obsession drives profitable growth. And you can see it in, again, how fast we're growing, you can see it in all time high active, driver hours and so forth and so on. So for riders and drivers, really trying to focus on what they need. Okay. So one of the things we've heard over the years is there's really only one subscription service out there for, food delivery and rideshare, and it's by the other guys. And DoorDash is, and DashPass is a great product and Lyft is a great product. So we decided, I was thinking, oh, this is before your time, but there was an old commercial, two great tastes that go great together. Reese's peanut butter cups, super old school, be clear, look it up, the ad's still around. But we decided to sort of bring these two companies together, even though we're two separate companies, DoorDash and Lyft, and try to create something that we think is better than what's out there. And you're right, people have a lot of subscriptions already. My hope, I think we've had about 500,000 people sign up just in the first twenty four hours, which is pretty cool. So what I hope is that people drop their other subscription to the other guys and pick this one up instead and get better value for
00:14:54 · Akash Pasricha
[00:14:54] S0: Tell me, what gives you confidence that in this $10 and there's a cheaper one, know, but let's stick to the $10 one for a second here. What sort of math have you done with respect to how much they are going to use your offering and your service compared to DoorDash's? And how does the incremental revenue from the membership then split between the two of you?
00:15:21 · David Risher
[00:15:21] S3: Yeah, I probably won't go into the business behind the scenes, who splits what revenue, but what I'll say is, so Lyft, if you look at our kind of, what's powered our growth over the last three years, a lot of it has been partnerships, right? We have a partnership with United Airlines, where you can earn miles on Lyft and burn miles on Lyft. We have a partnership with Alaska Airlines. We have a partnership with DoorDash that preexisted this, which gave you discounts on both platforms, and now this kind of evolves it to, you can earn on Lyft and then spend on DoorDash or Lyft. 30% of our rides are tagged to partnership rides. So we've gotten really good over the years at partnering with other, in some cases, very, very large companies, much larger than we are in the case of say United Airlines, to create things that benefit both companies and benefit riders or drivers depending. And I think that's a really sort of interesting, almost an ethos, that is going to work really well for us, for example, in the world of AVs, where again, we're going be partnered with other companies, much larger than we are in some cases, but still trying to create economic benefit for both. And so far we've been pretty successful at that.