While the concept of a ride-sharing marketplace based on
voluntary payments isn't unique (one of its more well-known local
competitors, SideCar, also launched in June), Lyft is looking to
branding as a differentiator. In addition to decking out their cars
with mustaches, Lyft drivers (who are vetted through DMV and
criminal background checks) are urged to fist-bump their passengers
upon picking them up, and passengers are urged upon installing the
app to sit in the front seat.
The idea is to "design happiness into the whole experience,"
according to John Zimmer, co-founder and chief operating officer of
Zimride, the company behind Lyft, who said there have been cases of
drivers and passengers who met and started dating.
Zimride's first product of the same name focuses on
longer-distance carpooling and is geared toward universities and
companies. It was founded four years ago and has raised $7.2
"To us, it's all one thing," Mr. Zimmer said of Zimride and
Lyft. "The goal is to solve the fact that 80% of seats on the road
Zimride last officially reported the number of Lyft drivers at
250, but it's looking to grow quickly and is actively recruiting
drivers using Facebook ads that mention making "$20+" an hour. It
hasn't seen a need to do any consumer marketing, Mr. Zimmer said.
He noted that Lyft's adviser, Mr. Bogusky, had warned against
pairing the company logo with its pink mustache icon in any overt
fashion, since the mystery behind the mustache would prompt those
wondering about the cars to talk and ask if anyone knew what they
The proliferation of ride-sharing apps has drawn attention from
regulatory agencies, and Lyft (along with SideCar and another
ride-sharing app, Tickengo) was served with a cease-and-desist order from the
California Public Utilities Commission over the summer on the
grounds that it hadn't been granted permission to operate.
But Mr. Zimmer says Zimride is now in "productive dialogue" with
the agency and hasn't been fined. (Notably, Uber was served a similar order in
2010 but has continued to operate in San Francisco, where it
started, with impunity.)
Once the business matures, Zimride ultimately intends to make
money off Lyft by taking a 20% cut of fares (technically
donations). Overhead includes its current 30 employees and the $1
million excess liability insurance policy it's taken out to head
off critics who suggest the service isn't safe.
Asked whether Lyft competes with Uber, a smartphone-based
car-hailing service that operates with professional drivers, Mr.
Zimmer said that the intimacy of the Lyft experience is different.
But he added: "All of us who are creating these alternatives are
making it easier not to own a car in the city."