SUSAN: BREAKING THIS HOUR.
AFTER ITS BIG BLOCKBUSTER DEBUT
ON FRIDAY, SHARES OF LYFT RIGHT
NOW, YEAH, TRADING DOWN FROM
12%, $68.88 APIECE.
THIS AFTER THE RIDE HAILING
SERVICE TUMBLED AS MUCH AS 11%
EARLIER, FALLING BELOW THE
STOCK'S IPO PRICE IN ITS FIRST
FULL DAY TRADING AS A PUBLIC
COMPANY.
SO STOCK TRADING AS LOW -- THESE
ARE SESSION LOWS, $68.69.
THAT'S MORE THAN 20% DOWN FROM
ITS FRIDAY INTRADAY HIGH OF
$88.60.
SO ONE DAY YOU'RE IN A BEAR
MARKET, ALREADY.
THE QUESTION IS, CAN LYFT
REVERSE COURSE AND LIVE UP TO
THE HYPE, OR WILL IT BE ANOTHER
SNAP WHERE IT JUST CAN'T HANDLE
THE PUBLIC PRESSURE.
OUR NEXT GUEST'S COMPANY HAS
WORKED WITH ONE OUT OF EVERY
THREE UNICORNS AND BIG NAMES
LIKE SPOTIFY, FITBIT, WHATSAPP,
AND HE JOINS US IN A FOX
BUSINESS EXCLUSIVE.
YOU HAVE TO TAKE A LOOK AT THE
SHARE PRICE OF LYFT.
NOW, WHAT YOU DO IS A LITTLE BIT
DIFFERENT BECAUSE YOU BASICALLY
HELP PRIVATE PLACEMENT, THE
PEOPLE THAT CAN GET IN BEFORE
THE IPO.
>> THAT'S RIGHT.
SUSAN: SO YOU GOT IN AT A $15
BILLION VALUATION, IF NOT BETTER
AND LOWER THAN THAT.
FOR THE IPO PURCHASERS, YOU ARE
IN AT $24 BILLION OR SO.
PEOPLE ARE THINKING THERE'S A
LOT OF HYPE.
>> THE AVERAGE INVESTOR USUALLY
WAITS UNTIL THE COMPANY GOES
PUBLIC WHICH MEANS YOU ARE
PROBABLY BUYING AT LEAST AT THE
POP, IF NOT HIGHER.
THOSE VALUES WERE ANYWHERE FROM,
I THINK THEY WENT UP AS HIGH AS
$88 A SHARE.
THAT'S A BIG CLIMB DOWN TO $69
BUT COMPARING IT TO SNAP I THINK
IS GOING A LITTLE TOO FAR.
SUSAN: WHY?
THEY ARE VERY SIMILAR IN THE
SENSE THEY WERE LOSING MONEY
GOING INTO THEIR IPO, THEY HAD A
BIG POP ON THEIR FIRST DAY AND
THEY COULDN'T CARRY THROUGH
BECAUSE THE NUMBERS AND THE
BUSINESS DIDN'T JUSTIFY IT.
>> I WOULD SAY IT'S LIKE
COMPARING APPLES WITH
DRAGONFRUIT.
YOU ARE TALKING ABOUT A COMPANY
THAT EVERYONE SAYS OH, MY GOD,
IT SOUNDS REALLY COOL, IT'S
SEXY, IT'S VERY EXOTIC BUT WHEN
YOU TRY IT, YOU SAY HUH, I DON'T
KNOW WHAT THE FUSS IS ALL ABOUT.
I THINK THAT'S SIMILAR WITH
SNAP.
WITH LYFT, YOU HAVE A $2 BILLION
REVENUE COMPANY, GROWING 100%
YEAR OVER YEAR.
WITH SNAP, YOU HAVE A COMPANY
THAT WENT PUBLIC WITH $400
MILLION IN REVENUE BUT $500
MILLION IN LOSSES.
SUSAN: OKAY.
YOU ARE ALSO LOSING $900 MILLION
A YEAR IN LYFT.
YOU'RE NOT GOING TO BE, BY THE
WAY, PROBABLY PROFITABLE UNTIL
2022, 2023 ACCORDING TO
GUGGENHEIM TODAY.
THEY ARE SAYING YOU MIGHT BE A
LITTLE BIT OVERVALUED,
ESPECIALLY IF YOU ARE LOOKING AT
$1.2 BILLION LOSS IN 2019.
>> THAT'S RIGHT.
BUT IF YOU TAKE A LOOK AT THE
TRAJECTORY THAT LYFT IS
DEMONSTRATING WITH ITS NET LOSS
MARGIN, YOU TALK ABOUT LYFT
LOSING 200% OF ITS REVENUE TWO
YEARS AGO.
TODAY, THAT NUMBER IS LESS THAN
50%.
YOU TAKE A LOOK AT UBER,
HOWEVER, WHO HAS NOT BEEN ABLE
TO MAINTAIN THAT TRAJECTORY
QUITE AT THE SAME LEVEL, YOU
START TO SEE THAT LYFT IS
PRIORITIZING A LINE TO
PROFITABILITY.
LYFT IS ACTIVELY TRYING TO MAKE
SURE ITS REVENUE GROWTH STAYS
CONSTANT, MEANING IT CONTINUES
TO GROW REALLY QUICKLY BUT ITS
LOSSES SHRINK OVER TIME.
I THINK THAT'S SOMETHING WE JUST
NEVER SAW WITH SNAP.
PERFECT EXAMPLE, LAST YEAR, SNAP
MADE LESS MONEY THAN LYFT AND
SPENT MORE MONEY THAN LYFT.
I SHOULD SAY LOST MORE MONEY
THAN LYFT, ACTUALLY.
SUSAN: LYFT IS A PURE PLAY.
LET'S BE HONEST.
IT'S A RIDE HAILING COMPANY
STILL SUBSIDIZING $2 FOR EVERY
RIDE.
SOME PEOPLE SAY RIDE HAILING IS
A WINNER TAKE ALL KIND OF
MARKET.
YOU SEE THAT INTERNATIONALLY IN
CHINA, IN SOUTHEAST ASIA, ALSO
RECENTLY IN THE MIDDLE EAST AS
WELL.
SO WITH THESE TYPE OF LOSSES,
AND THIS TYPE OF STOCK REACTION,
DO YOU THINK LYFT'S GOING TO BE
AROUND IN A FEW YEARS?
>> YEAH, LOOK, I WOULD SAY IN A
WINNER TAKE ALL MARKET WHEN IT'S
SOMETHING AS FUNDAMENTAL AS
TRANSPORTATION, UNLESS WE SEE
THE THING BECOMING A UTILITY
DOWN THE ROAD, UNLESS WE SEE THE
GOVERNMENT TAKING OVER AND
CONVERTING THIS INTO BUSES AND
SUBWAYS, OH, WAIT, WE KNOW WHAT
THAT LOOKS LIKE AND TURNS OUT TO
BE.
I ABSOLUTELY DO THINK LYFT IS
GOING TO FIND ITS WAY TOWARDS
PROFITABILITY.
MIGHT NOT BE IN TWO YEARS BUT WE
ARE TALKING ABOUT A TEN-YEAR
TIME HORIZON, I WOULD JUST SAY I
SPENT A LITTLE BIT OF TIME ON A
FARM GROWING UP.
I WOULD SAY IF YOU PLANT A SEED,
YOU DON'T DIG IT UP EVERY TWO
DAYS TO SEE HOW IT'S DOING.
YOU LET IT RUN ITS COURSE AND
BELIEVE IN IT OR YOU DON'T.
SUSAN: YOU THINK UBER IS
THINKING OF PRICING THEMSELVES,
THINKING OF LET'S DO SOMETHING A
LITTLE MORE REASONABLE INSTEAD
OF GOING $10 BILLION ABOVE THEIR
LAST PRIVATE ROUND OF
VALUATIONS?
>> UBER STARTED DOING OFF WHAT
LYFT'S ENTIRE BUSINESS IS TODAY.
UNLIKE LYFT, THAT'S ONLY IN
NORTH AMERICA, YOU HAVE UBER
THAT KIND OF HAS A GLOBAL
FOOTPRINT, HAS NINE OTHER
BUSINESS LINES INCLUDING UBER
EATS.
SUSAN: SELF-DRIVING.
YOU NAME IT.
THEY HAVE A BIG BRANCH OF
BUSINESSES.
>> THEY ARE BASICALLY GENERAL
ELECTRIC BEFORE EVEN BECOMING A
PUBLIC COMPANY.
SO I THINK THEY ARE VERY
DIFFERENT COMPANIES.
I THINK LYFT'S EXAMPLE GIVES