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Lyft Files S-1

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Re: Lyft Files S-1

#261

Post by meowface »

mech4bg wrote: post #164
cabaalis wrote: post #28

> In 2017 and 2018, certain of our named executive officers provided rides to riders using the Lyft platform in a similar manner as other drivers. We believe that these driving activities provide the named executive officers with substantial practical insight into how our platform serves drivers. I thought this was a pretty interesting point. I was about to call it dogfooding but not quite, since it's more of an expe…

I had one of the VC investors in Lyft pick me up for a ride a few years ago in Menlo Park. Had a super interesting conversation - I was impressed they were scoping out their investment directly. I wasn't sure what the protocol for tipping as at the end, hah.

That's really cool. How did you know they were an investor? Did they introduce themselves, or did you recognize them?

I imagine when investors or execs give rides, they probably don't generally reveal their affiliation, since that may skew the experience and the feedback. Though on the other hand, I suppose it could be helpful to say "I work at/with Lyft, how do you like the app?"

Re: Lyft Files S-1

#263

Post by treis »

throwaway-1283 wrote: post #260
treis wrote: post #258

Earlier quoted context omitted.

>The difference between a SaaS and a Lyft is that Lyft has huge operating expenses Lyft is SaaS (technically a platform) and doesn't really have more operating expenses than any other internet company.

Are you kidding? The driver acquisition costs are extremely high. Driver turnover is high. There's much higher support costs on both driver and rider side than a typical "pure" software co.

It's only high because they are in a money burning contest with a swath of other VC funded gig companies. There's nothing inherent about their business model that requires extremely high driver acquisition costs.

Re: Lyft Files S-1

#264

Post by eeeeeeeeeeeee »

halbritt wrote: post #172
doctorpangloss wrote: post #157

Earlier quoted context omitted.

> If those issues aren't in your company's core competencies, it's not necessarily efficient to invest in building out all of that. Maybe that's just the story cloud providers tell you. Until you try, do you really know if it's all that complicated? People have been running datacenters for a long time, and not all of them work for Amazon. But there may be also a beneficial side effect of having gearheads around, and…

Having done a bunch of bare metal, I can tell you the calculus isn't really that hard. Bare metal will save you money. Operating bare metal at scale requires talent that doesn't exist, not necessarily at an engineering level, but at all levels. As an example, I worked at a place that had a large bare metal deployment, i.e. >1MW worth of compute. It was woefully inefficient and costly to operate. The product that they…

I've been on both sides and it's not as simple as "bare metal saves you money." It really depends on the company and the type of applications being hosted and where the business is growing (or not growing). An established company with an established workload, especially if it's simple, will probably do better on bare metal, but cloud is popular in the Valley because ideas are still being developed and iterated on heavily where you don't want to be stuck on multi-year hardware leases that might not sync with what that future business looks like. Lyft is probably in that in-between stage, but I still think it's an enormous undertaking to become an infrastructure company over simply being able to hire full-stack developers, which is a lot easier and cheaper. Right now their time is better spent elsewhere.

I remember how hard it was to hire senior operations people. There are not many of them, and there are not many of them at the level of being able to deliver something amazing. The ubiquity of the cloud has only made these kind of experts less common.

Every place I've worked that did bare metal was always drowning in maintenance instead of working on the next big thing. And no big surprise, our internal infrastructure was nowhere near as high quality or capable as AWS. And most of our developers had experience working directly with cloud providers, without ops people, so we were delivering them a worse experience and slowing them down, and we required more ops people to help them and maintain it and keep everything online.

Also, a move to IBM's cloud isn't the greatest example. I had hundreds of bare metal servers in an IBM-owned datacenter and their cloud offering was consistently behind AWS/GCP; if anyone recommended IBM cloud to me I would have laughed at them. It seemed to me that IBM was trying to up-sell on the "cloud" buzz word without actually delivering anything except higher prices, just like how they're now trying to ride the buzz of the blockchain.

Dropbox is a good example of a company that took quite a while to move to their own platform, away from AWS (and they still have 10% of their stuff in AWS to this day). Dropbox is basically a storage infrastructure company, unlike Lyft, but it still took them years to invest in the development (and migration) of that custom platform to replace AWS, an investment that not many companies are going to want to gamble on, especially if their primary business is not storage:

https://techcrunch.com/2017/09/15/why-dropbox-decided-to-dro...

And I think it's telling that Dropbox started on AWS, grew the business on AWS, and moved to a custom platform once their business model was perfected and they wanted to cut costs prior to going public. If Dropbox had started on bare metal from day one, would they have been able to pull it off?

Re: Lyft Files S-1

#265

Post by throwaway-1283 »

treis wrote: post #263
throwaway-1283 wrote: post #260

Earlier quoted context omitted.

Are you kidding? The driver acquisition costs are extremely high. Driver turnover is high. There's much higher support costs on both driver and rider side than a typical "pure" software co.

It's only high because they are in a money burning contest with a swath of other VC funded gig companies. There's nothing inherent about their business model that requires extremely high driver acquisition costs.

What do you mean "nothing inherent." Turnover is high because pay is low, so they need to constantly recruit new drivers via signup bonuses that pad their earnings for the first X months. If they fail to attract drivers then their growth will tank because supply will not keep up with demand. Support needs are naturally high and things go wrong all the time because you're dealing with real people in the physical world - it's not just some bugs here or there on a computer screen.

Companies like Lyft/Uber also have a much higher % of their full time staff in "ops" roles that are driver-facing (support, onboarding, offboarding, marketing, acquisition, etc.)

So long as their business is extracting maximal fees from each fare (thus keeping driver pay low) this cycle will go on as long as it can, and acquisition costs will continue to be high.

Re: Lyft Files S-1

#266

Post by drewda »

cabaalis wrote: post #28

> In 2017 and 2018, certain of our named executive officers provided rides to riders using the Lyft platform in a similar manner as other drivers. We believe that these driving activities provide the named executive officers with substantial practical insight into how our platform serves drivers. I thought this was a pretty interesting point. I was about to call it dogfooding but not quite, since it's more of an expe…

Back around 2009 or 2010, my roommates and I put a spare room in our Berkeley place on Airbnb. One night the Airbnb CEO booked the room and came over for the night. Sounds like the company had grown large enough that the co-founders had to move out of their apartment-turned-office. The CEO had not yet gotten his own apartment. He instead would stay each night in a different Airbnb rental and go back to SF in the morning for work.

Re: Lyft Files S-1

#267

Post by Havoc »

CondensedBrain wrote: post #60
bluedino wrote: post #53

Earlier quoted context omitted.

That would buy a couple racks worth of servers and plenty of ops staff wouldn’t it?

Then they slowly turn into a datacenter company and lose sight of being a ride sharing company. That's the same reason billion dollar companies rent buildings instead of owning them.

>That's the same reason billion dollar companies rent buildings instead of owning them.

If you've got billions then you can create your own limited liability company, poach a bit of top talent to fill it (overpay a bit if you must) and get a decent operation going. One that will jump when you say jump no matter what.

You can't replace AWS global scale, but for your rental example its definitely possible. Companies rent mostly due to tax & liability reasons from what I can tell.

Re: Lyft Files S-1

#268

Post by eeeeeeeeeeeee »

vonmoltke wrote: post #207
theossuary wrote: post #165

Earlier quoted context omitted.

Yes, I've worked with a few of those datacenters. A few examples: - Recently had to purchase new servers, because of signed contracts the only servers we were allowed to purchase and put in the datacenter were four years old and technically EOF. - Firewall changes, AD changes, provisioning a VM, etc. are 48 hour turnaround. Purchasing new hardware requires 4-6 weeks. - Had an intermittent issue with their edge firewa…

> Yes, I've worked with a few of those datacenters. > I don't think I'd ever choose managed datacenter over AWS/GCP/Azure/etc. Who mentioned managed datacenters? I'm pretty sure people are talking about leasing space and doing everything else in-house.

I've done that too. It's obviously easier than running an entire datacenter, but you still need to manage all the underlying services that you deliver to your development team. For example, running things like this on your own:

- storage clusters

- database clusters

- compute clusters

They are often very easy to setup, but when things go wrong, they go very wrong. And welcome to a stressful environment because if you can't figure it out and your people can't, well, your business just sits and burns while you do.

Even when AWS has a system-wide outage, it's nice to know that I don't have to be dealing with those underlying problems anymore and I know they have the best people working on them.

I cannot put into words, after operating MySQL clusters on my own and playing back transactions after failures, how nice it is to use AWS RDS and how it's just been zero problems. Zero. I sleep through automatic updates of our database system with RDS. I would have never done that on our own system.

And in most places, even "managed" leased hardware, you still will need to purchase/lease and run your own hardware firewalls and ddos mitigation. The datacenter might offer that protection "built-in" but you'll soon find the limitations of that offering when you face a substantial attack.

Re: Lyft Files S-1

#269

Post by azylman »

meowface wrote: post #236
throwawaymath wrote: post #189

Earlier quoted context omitted.

Do you have any idea what the stipend typically is?

A quick Google search says it's $2000/year. Don't know if that's accurate.

I have some friends at AirBnB and I've heard it's much more modest, like $300/yr or something. My experience with these type of "dogfooding" credits is that companies are much more generous when they're smaller, so it could be that older employees get more than newer employees.

Re: Lyft Files S-1

#270

Post by codegoblins »

stepanhruda wrote: post #155
jonknee wrote: post #51

Earlier quoted context omitted.

On the other hand, the baseball player will create much more than that in value while Lyft has lost billions of dollars. If someone here is underpaid it's not the Lyft founders.

What value is exactly a baseball player creating? Lyft has provided WAY more value to society over its lifetime.

Drawing viewers' eyes to lucrative television timeslots for advertisers, selling tickets to local stadiums, and selling merchandise such as jerseys and figures.
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