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Lyft (LYFT) is making its biggest international move yet with its purchase of European taxi app FREENOW in a $200 million deal that opens the company to over 150 cities across nine countries.
Lyft CEO David Risher joins Catalysts host Madison Mills to explain why now is the right time to take the company global.
To watch more expert insights and analysis on the latest market action, check out more Catalysts here.
Lyft entering the European market buying taxi app Free Now in a $200 million deal. The acquisition will allow Lyft to expand in more than 150 cities across nine countries. Joining us now to discuss the news, David Risher, he is Lyft's CEO. David, thank you so much for coming in studio with us this morning. We appreciate it. Talk to me about this move. Why does this make sense now? I know you've been focused a little bit more domestically as of late.
Right. Well, so that's it. So for the last couple of years, we've been very focused domestically, and we now have better service than we've ever had before. We pick people up faster than ever. We're profitable, we're generating cash, and so now is the time for us to go big and go global. We're actually doubling our market size, the addressable market by going into Europe with Free Now.
It's interesting that this is the moment to go global when we are in the middle of a perhaps you could call it a global trade war with the United States and several other countries. How are you thinking about the impact of that as you think to expand? Are you going to use, you know, Lyft branding in Europe? Are you going to stick with Free Now? And how do you think about kind of the American image on a global stage right now?
Right. I mean, look, we're thinking long term, and you know, I am still, you know, I'm betting on America long term, no question. Short term, um, we'll definitely be operating with two different brands. Um, you know, nothing is going to change for riders or drivers. Um, but Free Now is a great product. It's actually a taxi first product which, if you're in the US, you might think taxis and you have a certain sort of impression here in New York City. But globally, taxis are an incredibly important business. Think of black cabs in London, think of Mercedes in Germany taking you to the airport. That's kind of what we're trying to kind of connect with.
Speaking of airports, I do want to get a sense of what you're seeing on the consumer side of things. Have you seen any slowdown in airport travel?
Not significant. You know, I mean, we look pretty closely at these things and it is true, maybe a tiny bit of softness on the airport side, but that's frankly made up for by a little bit of strength actually on people just kind of going out during the weeks. So nothing significant for us. Lyft is, you know, we do about two million rides a day and drivers make billions of dollars a year on it. It's really part of people's daily lives, not a discretionary thing that you might cut back on.
Okay, so talk to me about that. Where are you seeing evidence that this is part of someone's daily life that it sounds like you're describing it as a recession-proof necessity versus something that people can scale back?
I think so. I mean, look, people, again, it's just better to be driven around by somebody else, right? I mean, think about it. You're in the back seat, you can text, you can take a nap, you can talk to the driver if you want to. So, and for a lot of people rather than parking and so on and so forth, it's just a better way to get around. So what we've seen is, and you know this, quarter after quarter, growth, growth, growth. We have more drivers on the platform than ever. We have more active riders on the platform than ever. So I don't know. Recession proof is a dangerous thing to say, you never know, but I would say we're, as I say, pretty baked into people's lives.
And talk to me about how you prevent folks in bigger cities that do have access to things like public transportation from utilizing that a little bit more. Obviously, I'm having my East Coast bias right now, being based in New York City, but I have a lot of people in my life who've said, okay, we're worried about a recession, we're taking the subway even on a Saturday night.
Right. Well, I'll tell you what. So we operate bike systems across the United States as well. And it's interesting, we've actually seen some record highs in places like San Francisco where the weather is a little nicer, even here in New York a couple of weeks ago. There was a crazy warm day. So you know, maybe what we'll find is more people are biking and fewer people are taking ride share, but again, it's the sort of thing that I think for most people, how they get around, going to the doctor, going to the dentist, going for a job interview, it's pretty basic part of people's lives.
