Last week, Lyft It suddenly announced that its founders, President Logan Green and CEO John Zimmer, would be stepping away from the passenger carrier after 11 years. David Resher, a former Microsoft and Amazon executive who has been on Lyft’s board since 2021, will take over later this month.
The change to Lyft’s C-wing was surprising, but not surprising. For one thing, pre-teen and teen tech companies seem to be entering the age of corporate flops. Twitch’s Emmett Shear, Instacart’s Apoorva Mehta, Pinterest’s Ben Silbermann, and Peloton’s John Foley recently performed. But Lyft in particular is struggling. You didn’t make a profit. It’s losing market share to Uber. It laid off 13 percent of its staff last fall. Its share price is down about 90 percent since it went public in 2019.
Still, Green and Zimmer’s exits say something about how sentiment in the tech industry has shifted since the early 2010s, when young adults were racking up mountains of criticism for disrupting everything.
In the beginning, Lyft’s core offering was…feelings. Like the more expensive black car services, Travis Kalanick’s Uber was founded because Kalanick and his crew aspired to be “footballers.” By contrast, Lyft recruited anyone with a license, vehicle, and willingness to affix a fuzzy pink mustache to their car and greet strangers with fists, welcoming passengers into their front seats. It was Lyft that experimented with the peer-to-peer model of taxi hailing, the idea that anyone can become a taxi driver if they download the right app.
Zimmer liked to wax on the service’s potential to shape the city. An urban planning class at Cornell University, he often said, opened his eyes to the devastating effects of cars on city life—traffic, smog, and lots of parking lots taking up space that could become parks, playgrounds, or residences. The theory goes that Lyft and services like it could help many people escape the tyranny of car ownership by letting them occasionally use other people’s cars instead. When Lyft acquired America’s major bike-sharing operator in 2018, it offered the deal as another way to help cities.
It was a heart-warming story and got a credibility boost from Uber’s public meltdown in 2017. But it didn’t quite work out. Lyft’s ride-sharing concept initially proved to fuel the growth of the gig economy, which has some serious flaws. We’re still learning about the complex effects of separating service work from benefits like health care and sick pay.
Meanwhile, the commuter ordering service seems to have already increased traffic in the cities. And that thing that kills car ownership? Just a few months ago, Lyft introduced services to help car owners book parking and vehicle maintenance. How Lyft fits into anyone’s urban planning curriculum is less clear than Zimmer had hoped.
When I spoke last week to Risher, Lyft’s new CEO, it was clear that strategy based on sentiment had given way to the realities of failing organization change. Gone are some of the flashier marketing concepts; The rivets were brass. “I feel real energy about saying, ‘Let’s really focus on our ride-sharing business,’” Reacher told me. “Let’s get people on time. Let’s give them a good price, so they don’t defect to Uber. Let us drop them off where they say they need to go.”
When I asked Risher to name a distraction that has no place in the new paradigm, he highlighted Shared Rides (formerly Lyft Line), the service that offers users cheaper rates for sharing a car with a few other travelers. The common choice disappeared with the onset of the pandemic, but has returned in a few American cities.