Lyft Files for IPO • Hacker News Board

Re: Lyft Files for IPO

#81

Post by psgibbs » Thu, Dec 06, 2018, 5:15 PM UTC

a13n wrote: post #56

RandallBrown wrote: post #51

Earlier quoted context omitted.

Why would ridesharing be winner take all? There's almost no network effect (beyond splitting the cost, but Venmo has largely solved that) and the drivers all drive for all of them. In NYC I think there's at least 4 ridesharing companies and I usually choose which one based on which one has given me a promo.

There are plenty of network effects. To start a new ridesharing company, you have to get drivers and riders. You'd have to offer them a ton of incentives to start driving/riding with your service, when the existing options are well established. For drivers, Lyft and Uber have incentives (lower fees) if you do the majority of rides with their service, which incentivizes you to only drive with one service. When's the l…

I'd make the argument that because there are low costs of switching (as has been mentioned elsewhere), these are scale effects (like in most industries), rather than network effects.

Re: Lyft Files for IPO

#82

Post by CPLX » Thu, Dec 06, 2018, 5:16 PM UTC

docker_up wrote: post #63

From a purely investment point of view, why would anyone invest in Lyft over Uber? Lyft has a smaller footprint and only operates in the US (except Toronto). They are more susceptible to economic conditions in a single country, the US, and every point of marketshare they get is a zero-sum game against Uber and presumably expensive because Uber won't give it up for free. Uber has a global operations, is in multiple st…

Maybe because you believe that the investment of yourself and others will be profitably used by the company, and you'll be able to share in those profits.

An IPO isn't a bet, like at a racetrack, the money raised is actually used to further the business. It's quite possible this will give them the fuel for that expansion you mention.

Re: Lyft Files for IPO

#83

Post by mikekij » Thu, Dec 06, 2018, 5:17 PM UTC

bagacrap wrote: post #69

docker_up wrote: post #63

From a purely investment point of view, why would anyone invest in Lyft over Uber? Lyft has a smaller footprint and only operates in the US (except Toronto). They are more susceptible to economic conditions in a single country, the US, and every point of marketshare they get is a zero-sum game against Uber and presumably expensive because Uber won't give it up for free. Uber has a global operations, is in multiple st…

Even if you invest purely cynically you might reasonably believe that Uber's toxic culture will eventually catch up with them.

This. Why would anyone invest in Apple in 1998 instead of Microsoft?

Re: Lyft Files for IPO

#84

Post by Judgmentality » Thu, Dec 06, 2018, 5:19 PM UTC

mikekij wrote: post #83

bagacrap wrote: post #69

Earlier quoted context omitted.

Even if you invest purely cynically you might reasonably believe that Uber's toxic culture will eventually catch up with them.

This. Why would anyone invest in Apple in 1998 instead of Microsoft?

Because of the new CEO Steve Jobs?

Re: Lyft Files for IPO

#85

Post by akiselev » Thu, Dec 06, 2018, 5:19 PM UTC

docker_up wrote: post #63

From a purely investment point of view, why would anyone invest in Lyft over Uber? Lyft has a smaller footprint and only operates in the US (except Toronto). They are more susceptible to economic conditions in a single country, the US, and every point of marketshare they get is a zero-sum game against Uber and presumably expensive because Uber won't give it up for free. Uber has a global operations, is in multiple st…

The same reason you invest in anything else? You think you can make more money from it than the alternative within your investment timeframe.

Uber's last private valuation was, what, $60 billion? How much ROI do you think the LPs in the last round want to see from that investment after a few years? That sets the lower boundary for Uber's IPO price so unless Uber does a down round (which wont bode well for investor confidence), they're going to have to deliver a hell of a lot more value for their share price than Lyft, which means their is a lot more risk attached to them than lyft.

Buy low, sell high.

Re: Lyft Files for IPO

#86

Post by khazhou » Thu, Dec 06, 2018, 5:20 PM UTC

They filed a draft/confidential S-1, so don't bother yet searching for the document.

Re: Lyft Files for IPO

#87

Post by benj111 » Thu, Dec 06, 2018, 5:20 PM UTC

docker_up wrote: post #63

From a purely investment point of view, why would anyone invest in Lyft over Uber? Lyft has a smaller footprint and only operates in the US (except Toronto). They are more susceptible to economic conditions in a single country, the US, and every point of marketshare they get is a zero-sum game against Uber and presumably expensive because Uber won't give it up for free. Uber has a global operations, is in multiple st…

Uber takes the flack, gets the law changed, creates the market. Lyft sails in and gets most of the benefits, without those costs.

Uber doesn't have a massive moat. Drivers can have both apps, users can have both apps. You attract drivers by paying them more, you attract riders by charging them less. Uber for now can afford to beat everyone on both those fronts, but eventually they will have to start making a profit. When that happens Lyft is best placed to take advantage.

Re: Lyft Files for IPO

#88

Post by CPLX » Thu, Dec 06, 2018, 5:22 PM UTC

lewis500 wrote: post #55

RandallBrown wrote: post #51

Earlier quoted context omitted.

Why would ridesharing be winner take all? There's almost no network effect (beyond splitting the cost, but Venmo has largely solved that) and the drivers all drive for all of them. In NYC I think there's at least 4 ridesharing companies and I usually choose which one based on which one has given me a promo.

There is a network effect. Imagine if you made a ridesharing app with only one driver. No one would use the app due to high wait times. That's an edge case but it gets the point across: too few drivers and no one will use your app, and if no one uses the app no drivers will enlist in your service.

Of course your app with one driver would get usage. Your comment contains its internal contradiction right there in plain sight.

If "no one would use the app due to high wait times" then your driver would always be available and ready to go. So someone would be happy to use it whenever the dominant app is having trouble keeping up with demand. Which will always happen from time to time as long as demand has occasional peak periods and supply has some practical constraints, which a fleet of cars always will.

Re: Lyft Files for IPO

#89

Post by ghaff » Thu, Dec 06, 2018, 5:23 PM UTC

jcfrei wrote: post #72

sbilstein wrote: post #60

Earlier quoted context omitted.

You'd be surprised. Since switching is so low, you can pay your way to acquiring all the supply and demand to kick something off, hence all the ridesharing companies in NYC: https://finance.yahoo.com/news/ubers-competitors-in-nyc-are-... If you subsidize driving and subsidize riding significantly, people will sign up. A $40 bonus covers several rides for a customer so they'll hold onto the app at least until they've…

But Juno is only available in NYC (for now?). I think my points still hold outside of densely populated urban areas.

Sure. There are density thresholds for any local businesses. I can't even really get Uber around where I live. Maybe there are a few scattered cars but not many. You'd be pretty silly to set up a competing ride-hailing service here.

There's probably some critical mass for these services to work well and that's going to have at least some effect on whether it makes sense for a new entrant.

Re: Lyft Files for IPO

#90

Post by harryf » Thu, Dec 06, 2018, 5:24 PM UTC

docker_up wrote: post #63

From a purely investment point of view, why would anyone invest in Lyft over Uber? Lyft has a smaller footprint and only operates in the US (except Toronto). They are more susceptible to economic conditions in a single country, the US, and every point of marketshare they get is a zero-sum game against Uber and presumably expensive because Uber won't give it up for free. Uber has a global operations, is in multiple st…

Because Lyft is going to be on every car makers purchase list like Daimler bought MyTaxi ( https://www.google.com/amp/s/www.techtimes.com/amp/articles/... )