Logan Green: From Zimride to Lyft
Four Lessons from Logan Green, Co-Founder of Lyft
I had the chance to meet Logan Green last summer at Floodgate, and he also spoke at a class I TA-ed last winter (MS&E 275: Secrets of Scalable Startups). I’m a little late to writing this post, but I wanted to share his thoughtful, candid advice for young founders.
Ann Miura-Ko — a co-founding partner at Floodgate and a repeat member of the Forbes Midas List — led both fireside chats. She was one of the of the earliest believers in Logan and John Zimmer, writing her first check in 2010, while Lyft was still Zimride. Here are four lessons I learned from Ann’s chat with Logan:
1. Even with strong signals, pivoting takes courage.
Lyft was not Logan and John’s first idea — inspired by the carpooling culture in Zimbabwe and their frustration with public transportation, the two started a company called Zimride in 2007. They offered ride-sharing for long-distance car rides and partnered with colleges to help students get home for the holidays.
Zimride was growing, but it was growing linearly — rides were low-frequency, low-budget, and scheduled in advance. The team launched a series of experiments to supercharge growth, one of which capitalized on iOS-enabled, high-accuracy GPS tracking and the rising adoption of smartphones. These technological shifts enabled shorter, on-demand rides in urban areas, which they called Lyfts.
Unlike Zimride, growth came with minimal effort. Logan and John had to divert Zimride team members to Lyft to keep pace with demand.
It may seem obvious that Lyft was the right step forward, but Logan and John had spent the last five years selling investors, employees, and customers on their vision for Zimride. The decision to sunset Zimride in favor of a three-week experiment was not one they took lightly, but their hard-earned expertise in the transportation space gave them the conviction to move forward. They officially reincorporated as Lyft in 2013, dedicating the entire team to offering a low-cost, dependable alternative to Uber and taxis.
2. Lyft navigated fierce competition by sticking to its roots and tolerating dilution.
Today Lyft and Uber offer similar services, but it doesn’t take much digging to see that their origin stories are very different. Lyft came from Logan and John’s vision to build cities around people, not cars. They created a service that was truly peer-to-peer, encouraging customers to sit in the front seat and fist-bump their driver. In contrast, Uber started with a black car service. When asked about the motivations behind Uber, CEO Travis Kalanick said, “We wanted to be baller in San Francisco. That’s all it was about.”
While Uber was initially faster in gaining market share, Lyft’s foundational principles have emerged as a competitive advantage over time. Uber has weathered scandals due to a focus on winning at all costs, what the NYT called an “aggressive, unrestrained workplace culture.” Additionally, Lyft’s discipline around remaining a transportation-focused company — rather than diverting resources to initiatives like food delivery — has positioned them as a market leader in emerging growth areas. Bike-sharing is one of Lyft’s fastest-growing businesses, and they are the largest electric bike operator in North America. Lyft has also increased investment in autonomous vehicles while Uber has done the opposite.
During the fireside chat, Logan also mentioned that raising enough funding to seriously compete required tolerating significant equity dilution. While it was a difficult decision for the founders, Logan recognized that he would “rather have a slice of a watermelon than a whole grape.”
3. The right culture attracts the right team.
When asked about culture building, Logan told the cohort about two mistakes he made in the early days of building the company.
The first lesson was the degree of transparency a founder should have with early employees. He recalled his early sense of optimism with the team and hesitancy about sharing the harsh realities of startups: they can die at any moment. While Logan was worried that this would scare people away, he recognizes now that the employees who were scared off by this reality shouldn’t have been at Lyft in the first place. When he did reframe his messaging, it brought a shared sense of energy to the team and showed which employees had the mental fortitude to tackle this problem.
Along the same lines, Logan remembers a period when the recruiting team started using work-life balance as a selling point for joining the company. While Lyft is known for having a great culture and values work-life balance, Logan wanted employees drawn to Lyft’s gritty culture and vision for transportation. He pointed out that someone sold on work-life balance may not have the endurance to stick with the company during tough times.
4. Thunder Lizards are irrationally all-in.
Floodgate’s goal is to identify and back “Thunder Lizards,” entrepreneurs with the potential to change the business landscape and grow their company to a Godzilla-like scale.
Logan’s mentality around building Lyft is a testament to what it takes to be a Thunderlizard. He recounted how one investor told him and his co-founder that they were idiots for spending this much time on something with such a high likelihood of failure. While it may have seemed irrational from the outside in, Logan has been narrow-focused on transportation for decades. He grew up in gridlocked traffic in LA, intentionally went without a car in college to learn about public transit, and was recruited as the youngest member of the Santa Barbara transit board. Logan a clear example of founder-market fit, and building Zimride/Lyft was more important than anything else he could do.
Logan emphasized that the expected value from startups is low, so there has to be a burning need to build what you’re building. This internal fire is how — in the face of unfavorable odds and intractable challenges — Thunder Lizards find the conviction and endurance to keep going.
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