Lyft Files for IPO • Hacker News Board

Re: Lyft Files for IPO

#271

Post by rbowlby83 » Fri, Dec 07, 2018, 6:35 AM UTC

whttheuuu wrote: post #12

ArtWomb wrote: post #2

I see tremendous upside getting into either $LYFT below $20B or $UBER at $120B, which recently announced operational air taxi service by 2023.

Ride hailing is a commodity.

I'm not sure it's a commodity. Riders are not necessarily willing to wait indefinitely for the driver. Economies of scale is a factor in ride hailing. Perhaps a ride hailing company with fewer drivers can out perform a larger peer through predictive analysis, putting drivers in the right areas ahead of time. That likely amounts to a neat trick when you think about the scale of Uber and Lyft.

Uber has had to close down operations in several countries as well as several cities here in U.S.. Each time losing investors hard earned dollars. Lyft is most definitely, as others mentioned, in the slipstream; benefiting from Ubers successes and failures.

Lyft is a brand people respect and love and Uber not so much; at least not here in the U.S.

Lyft also has partnered with Google's Waymo. I think that partnership is limited to testing autonomous ride share but Google is also an investor in Lyft. A future acquisition or partnership doesn't seem out of the question. I see room for a few players to own the market and if I were an investor I'd go with Lyft.

Re: Lyft Files for IPO

#272

Post by Cursuviam » Fri, Dec 07, 2018, 6:58 AM UTC

pbreit wrote: post #264

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…

Lyft has huge upside, Uber has none.

"Jefferson has beliefs, Burr has none." (From Hamilton)

Re: Lyft Files for IPO

#273

Post by iblaine » Fri, Dec 07, 2018, 7:11 AM UTC

If we learned anything from SNAP, it's that investors are still greedy. APPF is a good example of a recent IPO that has done very well since its IPO date. IMHO, hyped up companies like Lyft have all the value sucked out before the IPO.

Re: Lyft Files for IPO

#274

Post by baddox » Fri, Dec 07, 2018, 7:21 AM UTC

speby wrote: post #261

hn_throwaway_99 wrote: post #252

Earlier quoted context omitted.

> Whether these companies have the unit economics to succeed is, remarkably, still an open question. I don't think there are many people who doubt that ride hailing apps can be done profitably. I think the big question is (a) is it a commodity business (I personally believe it is) and (b) can potential profit margins support their astronomical valuations. I think the main problem (though MUCH more so for Uber than fo…

> but I think the reality is that it will turn out to be much more like the airline business - basically a commodity business where raising prices is extremely difficult. I believe you are onto something there. What did people do before Lyft/Uber? They walked more. They biked. They took public transportation. Maybe they drove themselves. Maybe they drove/carpooled with a friend. Maybe they took a good old fashioned t…

Sounds like you’re talking about the price elasticity of demand. You describe airline travel (at least for personal economy class flights) to be fairly inelastic, meaning that if the price rises even a little bit, a lot of people will just drive or not take the trip. That certainly rings true to me. I recently bought US domestic flights home for Christmas, and I certainly chose the absolute cheapest flight that fit the schedule and had less than 2 hours of layover. The price was already brutal, and I felt like I was very near the top of my price tolerance.

But I feel like the Lyft/Uber mode of transport is generally more spontaneously and is therefore generally more elastic. Sure, there are undoubtedly some inelastic use cases, like regular commutes, but there are also some very elastic use cases, like a ride home from the bar or a rescue from the rain. I am definitely interested to see how the breakdown of these different use cases turns out to be, but for me and my friends and peers in the SF Bay Area, the latter use case definitely dominates.

https://en.m.wikipedia.org/wiki/Price_elasticity_of_demand

Re: Lyft Files for IPO

#275

Post by baddox » Fri, Dec 07, 2018, 7:27 AM UTC

pbreit wrote: post #263

hn_throwaway_99 wrote: post #252

Earlier quoted context omitted.

> Whether these companies have the unit economics to succeed is, remarkably, still an open question. I don't think there are many people who doubt that ride hailing apps can be done profitably. I think the big question is (a) is it a commodity business (I personally believe it is) and (b) can potential profit margins support their astronomical valuations. I think the main problem (though MUCH more so for Uber than fo…

When you say you think it's a commodity business could you imagine a new entrant in a mature Lyft/Uber market? I couldn't. Pockets would have to be very deep. The basic economics of Uber/Lyft-style transportation is very profitable. The biggest economic challenges are 1) entering a market and 2) pools. And Lyft & Uber fighting each other.

I can imagine it. I’ve lived in San Francisco since 2011, and I remember using Uber, Lyft, and Sidecar. I have had long periods where I was “loyal” to each of those three, with Lyft being the current and longest-lived loyalty. At various times in the past I would comparison shop between all three, looking for the cheapest or quickest option.

Re: Lyft Files for IPO

#276

Post by IshKebab » Fri, Dec 07, 2018, 7:41 AM UTC

pbreit wrote: post #263

hn_throwaway_99 wrote: post #252

Earlier quoted context omitted.

> Whether these companies have the unit economics to succeed is, remarkably, still an open question. I don't think there are many people who doubt that ride hailing apps can be done profitably. I think the big question is (a) is it a commodity business (I personally believe it is) and (b) can potential profit margins support their astronomical valuations. I think the main problem (though MUCH more so for Uber than fo…

When you say you think it's a commodity business could you imagine a new entrant in a mature Lyft/Uber market? I couldn't. Pockets would have to be very deep. The basic economics of Uber/Lyft-style transportation is very profitable. The biggest economic challenges are 1) entering a market and 2) pools. And Lyft & Uber fighting each other.

Yes it would be fairly easy:

1. Start in one city only and concentrate on that. 2. Get your service listed in Google Maps. 3. Gradually expand.

Job done. The only real defence against that is that Uber/Lyft could probably afford to undercut you until you go out of business, Walmart-style.

Re: Lyft Files for IPO

#277

Post by skrebbel » Fri, Dec 07, 2018, 9:02 AM UTC

lbacaj wrote: post #48

I see a lot of comments on here about the efficiency of Lyft/Uber's and lots of comments about their overspending. The new book by Reid Hoffman, Blitzscaling, was an eye-opener for me as to how these companies operate and what seems as incredibly inefficient now will all be but forgotten tomorrow when they have complete monopolies over all transportation... The nature of technology makes it winner take all almost alw…

> complete monopolies over all transportation

No way I'm going to pay Uber for the right to use my bike.

Re: Lyft Files for IPO

#278

Post by gaius » Fri, Dec 07, 2018, 9:56 AM UTC

baddox wrote: post #274

speby wrote: post #261

Earlier quoted context omitted.

> but I think the reality is that it will turn out to be much more like the airline business - basically a commodity business where raising prices is extremely difficult. I believe you are onto something there. What did people do before Lyft/Uber? They walked more. They biked. They took public transportation. Maybe they drove themselves. Maybe they drove/carpooled with a friend. Maybe they took a good old fashioned t…

Sounds like you’re talking about the price elasticity of demand. You describe airline travel (at least for personal economy class flights) to be fairly inelastic, meaning that if the price rises even a little bit, a lot of people will just drive or not take the trip. That certainly rings true to me. I recently bought US domestic flights home for Christmas, and I certainly chose the absolute cheapest flight that fit t…

very elastic use cases, like a ride home from the bar or a rescue from the rain

They manage demand via surge pricing, I thought. So is it really elastic?

Re: Lyft Files for IPO

#279

Post by gaius » Fri, Dec 07, 2018, 10:02 AM UTC

0x8BADF00D wrote: post #268

the_reformation wrote: post #200

The most exciting implication here is that we can finally pour over the financials of a major ride-hailing company. Whether these companies have the unit economics to succeed is, remarkably, still an open question.

Unit economics don’t really matter in this case. Lyft and Uber could be hemorrhaging money but the paradigm has fundamentally shifted. Ownership as we know it will become meaningless. Sure, you could buy a self-driving car, but do you need to? Waymo One’s launch will determine the future of ridesharing companies, not unit economics.

Ownership as we know it will become meaningless. Sure, you could buy a self-driving car, but do you need to?

I wonder if people who say things like this are actually drivers, because every driver I know has a car full of random stuff that lives permanently in it incase it’s needed. No one is going to carry all that with them; if they did it wouldn’t live in the car in the first place! Ownership isn’t going anywhere, or taxis would already have killed private ownership (and hotels would have killed the housing market...)

Re: Lyft Files for IPO

#280

Post by sanedigital » Fri, Dec 07, 2018, 11:06 AM UTC

gaius wrote: post #279

0x8BADF00D wrote: post #268

Earlier quoted context omitted.

Unit economics don’t really matter in this case. Lyft and Uber could be hemorrhaging money but the paradigm has fundamentally shifted. Ownership as we know it will become meaningless. Sure, you could buy a self-driving car, but do you need to? Waymo One’s launch will determine the future of ridesharing companies, not unit economics.

Ownership as we know it will become meaningless. Sure, you could buy a self-driving car, but do you need to? I wonder if people who say things like this are actually drivers, because every driver I know has a car full of random stuff that lives permanently in it incase it’s needed. No one is going to carry all that with them; if they did it wouldn’t live in the car in the first place! Ownership isn’t going anywhere,…

But then where do people without cars keep all of these necessary items? I live in an urban area, I own a car, and I have almost nothing in it besides a car seat.

Taxis have killed ownership in places where taxis are more convenient than car ownership. As ride sharing becomes more ubiquitous—especially as self driving vehicles move into the space—that's going to become a reality in more and more locations.