Lyft looking to raise $500M in new funding at valuation of about $4B

Post by jcdavis » Wed, Nov 18, 2015, 6:33 AM UTC

rahimnathwani wrote: post #19

jcdavis wrote: post #2

"At the Robin Hood Investors Conference in New York on Tuesday, Lyft said it expected to generate about $1 billion in annualized gross revenue next year, a figure that does not account for the cut of money the drivers take from each transaction." Maybe I'm missing something, but isn't the driver's "cut" like 80%+? This seems pretty misleading

When you order a ride with Lyft, a contract is established between you and Lyft. You pay Lyft $10. Payment to the driver is a cost incurred by Lyft in providing services to you. When you order something on eBay, a contract is established between you and the seller. You pay the seller $10. The seller gives eBay a cut. eBay's cut is a cost incurred by the seller in providing goods to you.

Post by rory096 » Wed, Nov 18, 2015, 6:39 AM UTC

gamblor956 wrote: post #16

dietrichepp wrote: post #8

Earlier quoted context omitted.

It doesn't sound particularly misleading to me. That's just what "gross" means. Gross is always way, way higher than net. You wouldn't subtract the wholesale cost from the gross income of a retail chain, you wouldn't subtract employee wages from the gross income of a software firm, and you wouldn't subtract contractor payments from Lyft.

Under generally accepted accounting principles (GAAP), and their European equivalent, IFRS, a company generally cannot include in income payments it receives on behalf of others. Lyft, and Uber, rely on the fiction that they are merely booking apps for drivers, so the fares belong to the driver, and Lyft and Uber are merely entitled to a portion of the fare for providing the booking service. At no time are they/were…

Post by forrestthewoods » Wed, Nov 18, 2015, 6:50 AM UTC

gamblor956 wrote: post #16

dietrichepp wrote: post #8

Earlier quoted context omitted.

It doesn't sound particularly misleading to me. That's just what "gross" means. Gross is always way, way higher than net. You wouldn't subtract the wholesale cost from the gross income of a retail chain, you wouldn't subtract employee wages from the gross income of a software firm, and you wouldn't subtract contractor payments from Lyft.

Under generally accepted accounting principles (GAAP), and their European equivalent, IFRS, a company generally cannot include in income payments it receives on behalf of others. Lyft, and Uber, rely on the fiction that they are merely booking apps for drivers, so the fares belong to the driver, and Lyft and Uber are merely entitled to a portion of the fare for providing the booking service. At no time are they/were…

Post by [deleted] » Wed, Nov 18, 2015, 6:54 AM UTC

rahimnathwani wrote: post #19

jcdavis wrote: post #2

"At the Robin Hood Investors Conference in New York on Tuesday, Lyft said it expected to generate about $1 billion in annualized gross revenue next year, a figure that does not account for the cut of money the drivers take from each transaction." Maybe I'm missing something, but isn't the driver's "cut" like 80%+? This seems pretty misleading

When you order a ride with Lyft, a contract is established between you and Lyft. You pay Lyft $10. Payment to the driver is a cost incurred by Lyft in providing services to you. When you order something on eBay, a contract is established between you and the seller. You pay the seller $10. The seller gives eBay a cut. eBay's cut is a cost incurred by the seller in providing goods to you.

Post by cperciva » Wed, Nov 18, 2015, 7:02 AM UTC

flashman wrote: post #7

Ah, Uber took money from Google Ventures, that's why Uber is listed as an option in my Google Maps app.