Lyft Co-Founders to Resign; David Risher Is Named CEO - The New York Times

Lyft has been slow to bounce back from early pandemic problems even as the business of its much bigger rival, Uber, has improved.

Lyft’s co-founders said on Monday that they would step down from their day-to-day responsibilities at the company, which has struggled through layoffs and disappointing financial results even as Uber, its biggest rival, has strengthened.

The founders — Logan Green, Lyft’s chief executive, and John Zimmer, its president — will stay on the company’s board of directors, they said.

After starting Lyft in 2012, Mr. Green and Mr. Zimmer, now both 39, were high-profile personalities in its early days. They presented Lyft as a friendly alternative to Uber and its aggressive chief executive, Travis Kalanick, and avoided many of the controversies that enveloped their competitor.

But Lyft, like many other gig companies, has been unable to turn a profit despite years of fast growth, and in recent years has fallen further behind Uber in the ride-hailing business while failing to branch out into other businesses, such as food delivery.

David Risher, the chief executive of a nonprofit called Worldreader and a member of Lyft’s board, will replace Mr. Green as chief executive. Mr. Green’s last day will be April 17, and he will become the chairman of the board. Mr. Zimmer will depart his current role at the end of June and become vice chair, the company said.

“As I pass the baton to David, I want to share this: We continue to have an incredible opportunity to push the boundaries on how transportation can help connect people and build a better future,” Mr. Green said in a blog post.

Lyft’s business has been slow to rebound from the lockdowns of the early days of pandemic, as driver supply problems have caused high prices and long waits for passengers. Lyft’s stock price has dropped below $10, down from about $40 a year ago and close to $80 at its peak.

News of the resignations, which was reported earlier by The Wall Street Journal, sent the company’s stock price surging in after-hours trading.

Early in the pandemic, Lyft and Uber were on nearly equal footing: The vast majority of their businesses had to shut down, and they laid off many of their employees.

But Uber, which has a global presence that Lyft lacks, bounced back more quickly, partly because its worldwide availability and food delivery business kept drivers on its platform and blunted the impact of the pandemic, analysts and former employees have said.

Uber also invested more in financial incentives to persuade drivers to return to the platform after the pandemic ebbed, while Lyft did not initially have enough drivers to meet resurgent rider demand.

In November, Lyft laid off 13 percent of its employees. Then, in February, it spooked investors when its financial projections for the year fell below their expectations, sending its stock price tumbling. Lyft said at the time that it needed to lower prices to be more competitive.

Lyft did report record revenue of $1.2 billion in its most recent quarter — as well as $588 million in losses.

Tom White, a senior research analyst with the financial firm D.A. Davidson, said he considered the leadership change a “potential modest positive.”

A new leader, he said in an email, “could signal increased willingness to broaden Lyft’s strategic aperture a bit as it relates to other possible adjacent products (delivery?), partners or ways to create value.”

This is a developing story. Check back for updates.

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Lyft Co-Founders to Resign; David Risher Is Named CEO - The New York Times
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