A Few Years Ago, Uber Almost Killed Lyft. Then Lyft Did Something Brilliant

How Lyft used laser-sharp focus to beat the odds and emerge from Uber’s shadow.

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BY Justin Bariso - 01 Apr 2019

uber almost killed lyft

PHOTO CREDIT: Getty Images

The year was 2014.

Competition was heating up between Uber and Lyft, two companies with similar visions: Use the rapidly emerging gig economy to transform the transportation industry. Uber, which had a three year head start on Lyft, was bigger, had more money, and was operating in more cities than Lyft.

It was at this point that Travis Kalanick, Uber's CEO at the time, tried to eliminate his closest competition--by offering to buy Lyft. But Lyft's co-founders, Logan Green and John Zimmer, turned down the offer.

It was a huge risk, one that looked like it would doom Lyft only months later.

In early 2015, Lyft only had about four months of cash left. In stark contrast, Uber had just raised over $2.5 billion. One of Lyft's largest investors, a serial entrepreneur and investor with decades of experience, advised the two cofounders to shut down the company.

"The odds were stacked against us," Zimmer said in a recent interview with Inc. "Most people were already counting us out."

Fast forward to today. As of Friday, Lyft has officially beaten Uber in the race to go public, raising $2.34 billion in the process. Lyft, which now operates in 300 markets, says that its number of quarterly active riders has tripled in the last two years.

And while Uber continues to hold a larger U.S. market share, Lyft has gained major ground: Lyft says it now holds 39% of the U.S. rideshare market, up from 22% just two years ago.

So, how did Lyft do it?

Looking back at the company's actions over the past few years, we could sum up Lyft's great comeback in a single word:


"What that investor told us was the best and most important advice Logan and I ever received because it forced us to double down on our conviction, to double down on our values, and to double down on our belief in the team," said Zimmer.

With their backs up against the wall, Lyft's co-founders focused on what made their company different from its competitor. For example, Lyft built a reputation as the kindler, gentler of the two brands, partially through efforts to put prioritize drivers and their needs.

Lyft has also built a strong focus on its corporate strategy, which also differs greatly from Uber's.

For example, consider that Uber has spent millions of dollars building a global brand (Uber currently operates in over 60 countries), as well as diversifying in markets such as food delivery and freight transport, and building its own autonomous driving technology.

Lyft, on the other hand, is adamant that it is focused on passenger transport. They've invested in autonomous driving, but more cautiously. And while Green and Zimmer see potential for expanding in other countries down the road, they remain focused on North America for now. (Lyft recently expanded into Toronto, its first city outside of the U.S.)

"We're really happy with the focus that we've had," said Green in a recent interview. "We're going at the right pace. We're going deep in transportation, deep in the markets we're in, that allows us to gain the share that we've gained."

So, what about the future for Lyft?

The company is currently working on integrating public transportation information directly into the app. The goal? In a world where the transportation model is shifting dramatically, the founders want Lyft to become the first place consumers go to figure out how they're going to get from point a to point b.

"We don't care if it's a ride on our platform, or if it's the bus, or the train," says Zimmer. "In fact, we'd love to connect you to whatever the best option is."

When it comes to car ownership, Zimmer says he wants Lyft to enable a better consumer experience, at a better price point. Imagine using Lyft to service, clean, fuel, and even insure your automobile.

"That's the magic of service," says Zimmer.

It's that type of focus, that customer-first mentality that has helped Lyft not only survive, but to thrive.

Green and Zimmer have refused to say how much Kalanick offered to buy Lyft for all those years ago. But when asked if they were happy they didn't take the deal, Zimmer answered for both of them.

"Very happy."


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