The transportation network company’s 31-year-old president launched the business alongside CEO Logan Green three years ago as part of a bigger service called Zimride. The business grew and turned into a standalone company with over 400 drivers and presence in more than 65 U.S. cities.
According to the AAA Foundation for Traffic Safety, from 2007 to 2011, the number of cars purchased by Americans between ages 18 to 34 dropped by roughly 30 per cent, because cars are perceived as less and less of a priority.
Millennials represent a significant part of Lyft’s growth; Zimmer recently told Mashable “you could actually start seeing the majority of millennials in the next five years or so saying there’s no reason I should get a car.” Although the car used to be one of the symbols that best described American freedom, it has now become a liability, because owning one means paying for all expenses such as fuel, repairs and assurance.
Both Uber and Lyft have dramatically expanded and even though the former covers over 300 cities across the world, there is room for both services when it comes to market availability. Over 100,000 Lyft drivers give more than two million rides per month and Lyft Line, the company’s version of carpooling, accounts for more than 50 per cent of all the business’ rides in San Francisco. In 2014, Lyft’s revenue and number of rides increased five-fold.
Lyft’s success does sound surreal, but given the fact that millennials are giving up the cosiness of their own vehicles in ride-sharing companies’ favour, it’s no wonder this business is leaving its start-up self behind. Zimmer told the media website that when he decided to leave his job at Lehman Brothers to develop Zimride, he was told he was “crazy” to leave a secure job to “do a crazy carpool start-up.” After the duo [Zimmer and Green] transformed the carpooling service created with the purpose to help university students share rides back home during the holidays into a mobile experience for booking rides, the start-up raised roughly US$1 billion and became a so-called “start-up unicorn.” It now shares the stage with other start-up unicorns such as Uber, Airbnb and Snapchat.
Zimmer’s prediction about millennials and their travelling preferences may or may not be correct, but the company is ready for phase two: global expansion. A 2015 survey commissioned by CALinnovates and conducted by Zogby Analytics revealed that over half of millennials have used sharing services such as Uber, Lyft and Airbnb, while 54 per cent expect such services to become even more popular in the near future.
The Washington Post’s Emily Badger wrote in a 2014 op-ed that regardless of what millennials are doing right now, “it’s highly likely that they’ll drive more as they age into their 30s and 40s.” Despite all the predictions and analyses, the question is if millennials’ driving habits diminish as time goes by. Lyft seems to believe that their driving days are almost behind them.