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Lyft Files S-1

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Re: Lyft Files S-1

#291

Post by halbritt »

eeeeeeeeeeeee wrote: post #264
halbritt wrote: post #172

Earlier quoted context omitted.

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 hea…

IBM cloud is a joke. That's why I put it in there. The aforementioned executive was clearly not thinking.

There's nothing you've written that I disagree with. It's easy to do the math that shows where bare metal saves money inclusive of the labor costs. For some reason most everyone seems to fail at it. I could expound one why, but this:

>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.

Those folks just don't exist. Building infra is more than just buying infra. It takes actual development, which is why I think so many fail at it.

Your anecdote about Dropbox is telling. They adopted cloud, and more importantly cloud methodologies and then went back to bare metal. There are others that have done the same. I recall a talk at an Openstack conference given by Verizon in which they described their approach. Developers begin in AWS, utilize a cloud-based approach, and then when cost concerns become an issue, they aim to offer similar services in-house on bare-metal.

Re: Lyft Files S-1

#292

Post by halbritt »

python300 wrote: post #208
halbritt wrote: post #172

Earlier quoted context omitted.

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…

The description here seems to be more of the compute and storage. How about the boat load of services that are offered with AWS. Plugging and playing with services maintained by AWS makes it easier for companies to focus on their product logic. The major expense is actually engineering.

Outside of S3 I can't think of any services that AWS offers that are worth a damn.

Re: Lyft Files S-1

#293

Post by hhw »

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.

They could also just rent dedicated bare metal servers on a month-to-month basis, getting whatever hardware specs they want so long as it's not overly exotic. Then they don't have to worry about anything at the data centre or hardware level.

Given that cloud costs easily 6-7x for the equivalent amount of hardware resources as a well priced dedicated server provider, you can just buy 2-3x the resources you need for extra scalability and not have to share those resources with anyone. Or if you are in the tiny minority of companies that really does have extremely erratic load requirements, you can put your base load on bare metal and your excess load on cloud.

I don't understand why people on HN always put forth a false dichotomy between cloud and running your own data centre when there's a plethora of different mixes of infrastructure and managed services that falls in between.

Re: Lyft Files S-1

#294

Post by halbritt »

python300 wrote: post #211
halbritt wrote: post #172

Earlier quoted context omitted.

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…

From a Lyft engineering perspective would rather focus on things like how do I make sense, process, extract the ton of data. How do I focus on customer experience rather than how do I save money in data-center, how do I keep my data-center stack updated and many more

My argument is that spending 10% of their revenue on cloud infra affects their unit economics sufficiently that they'll find it difficult to compete.

Perfectly willing to admit I'm wrong if and when that time comes. At this point, that's my theory.

Re: Lyft Files S-1

#295

Post by mech4bg »

meowface wrote: post #261
mech4bg wrote: post #164

Earlier quoted context omitted.

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?"

He told me up front and it let him ask me a bunch of questions about how/why I use Lyft.

Re: Lyft Files S-1

#296

Post by [deleted] »

fierro wrote: post #154
geezerjay wrote: post #72

Earlier quoted context omitted.

At this point isn't it cost-effective for Lyft to just build its own infrastructure?

if I have one job in this life, it's to hang out on hacker news and repeatedly post about how it's not cost effective to run your own infrastructure. 8MM/month doesn't even come CLOSE to needing your own infra. - person who knows how hard it is to run your own infrastructure

[deleted]

Re: Lyft Files S-1

#297

Post by Alupis »

spookthesunset wrote: post #278
ericd wrote: post #274

Earlier quoted context omitted.

We ran our own at a significantly smaller scale, it didn't take us nearly as much time to maintain as it saved us in terms of money over cloud.

I promise you weren't actually doing your costing correctly to arrive at that conclusion. Engineers always badly mis-underestimate the costs of things and "rack & stack data center management" is way more costly than you are actually accounting for. Especially in terms of opportunity cost and, well, just wasted resources that aren't actually adding value to the company. There is way, way, way, way, way more to a runn…

Majority of businesses aren't running insane computations at huge scales...

Most are running a few small internal-facing servers hosting some internally developed apps, and need very little resources.

Just run ESXi, XenServer, Xen or something, and spin up a few VM's on a few thousand dollars of hardware, get a couple people to maintain it, and be done.

Even at large scales, like Lyft, having your own internal team and hardware is going to save money. Amazon is profiting off your instances... which leaves room for you to do it for less. Maybe not $7mm less monthly, but even a $1mm savings is significant... but likely a lot more.

Re: Lyft Files S-1

#298

Post by sonnyblarney »

BinaryIdiot wrote: post #199
throwaway-1283 wrote: post #148

Earlier quoted context omitted.

I don't see how these companies will stop losing $1b+ a year each year. The public markets will not be too kind. The end game was supposed to be autonomous taxis (cutting the driver out). I don't see how that's going to happen before they run out of money unless they 1) significantly raise prices or 2) take increasingly bigger cuts from drivers. Personally I will be shorting as soon as I can.

Right? Even if autonomous taxis _is_ their endgame, why couldn't companies that actually produce the cars do it cheaper? Almost all of them are heavily investing in it right now, some are even partnering up with companies that know how to do a lot of it. I don't see how this works out for Lyft or Uber. To me it just looks like they'll both eventually run out of money and get squashed. Maybe I'm missing something?

Auto companies are not service companies, those are very different things.

That said, given the dynamism of markets, there's nothing to indicate that Lyft/Uber will have any huge advantage when the time comes.

But this is a game of musical chairs - early investors need to create the biggest, most miraculous but 'believable' story so they can pass the bag onto retail investors long enough to cash out.

If retail investors were able to do their homework, or rather, if their advisors at Morgan Stanley etc. were to do their jobs, I think that they'd see there is far more risk in these things than the valuations imply.

The problem is of course is that Morgan Stanley private wealth managers, managing for all those doctors, dentists, lawyers etc. only make money if there is buying action. And the emotional excitement of 'getting in on an IPO' is just too much to ignore.

The 'bragging rights' value of your dentist in Akron Ohio being able to tell to his buddies on the golf course that 'he has an 'in' on the Lyft IPO' (not really of course, he's at the tail end), is just worth more than a scrutinized deal.

Also - notice the PR/branding for Lyft, it's so funny, like the opposite of Uber - and yet they are for all intents and purposes the very same thing.

Re: Lyft Files S-1

#299

Post by panarky »

whymauri wrote: post #290
panarky wrote: post #284

Earlier quoted context omitted.

> that seems high to me What data do you have that indicates their market share is overstated?

Obviously they have no data, it's a hunch they have. This should be clear from how it's stated.

I value informed opinion much more than random anecdotes.

I'm hoping there's more to this comment than just "my friends use Uber so it's hard to believe Lyft has 39% market share".

Re: Lyft Files S-1

#300

Post by panarky »

windyaskew wrote: post #161
cm2012 wrote: post #6

Some notes: - They claim their US ride sharing marketshare is 39% - that seems high to me. - $800 mil in marketing spend in 2018 from $500 mil in 2017 - they say this increase was largely driven by cost of acquiring new drivers. I honestly thought this would be higher as a % of revenue - this topline number also includes spend on promotions/discounts for passengers.

From this article [1] posted a few days ago, TC says 34% (Uber is at 66%) and that's due to running at a larger loss by offering discounts to riders. Gaining 4% market share is no small feat but doing it by giving discounts isn't exactly a long-term vision. [1]: https://techcrunch.com/2019/02/26/heres-why-youre-getting-al...

This is a network game, so market share is everything.

Market share means drivers stay busy and make money. Market share means riders don't have to wait a long time.

Uber gave massive discounts for a long time to establish their market share, and it suited their long-term vision just fine.

Same strategy seems to be working well for Lyft, too.

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