Tarun Nagar 
With the increasing demand for ridesharing services, applications like Lyft has seen tremendous growth and popularity. Statista says the global ride-sharing market is expected to grow around 110% from 2021 to 2025, approximately $170-180 million in 2025.
So, there is no denying why businesses are looking forward to investing in Lyft-like taxi app solutions and showing interest in Lyft business model, working process, and revenue model.
If you are also looking for the same, this blog might help you. It highlights everything about Lyft business model and how businesses generate revenue from such ride-sharing applications.
Table of Contents
What Is Lyft?
Lyft was introduced in 2012 by Logan Green and John Zimmer. It was a type of service operated under Zimride, a long-distance intercity carpooling company. Currently, Lyft is a primary service and an organization offering multiple services.
The application offers car rental and food delivery services and taxi app solutions. Lyft business model is equivalent to Uber and has become the second-largest ride-sharing service provider in the U.S., with a 32% market share. Its user-friendly business model and user-friendly interface decrease the cost to develop a taxi app like Lyft.
|
Year of Foundation |
2012 |
|
Founders |
Logan Green and John Zimmer |
|
Headquarters |
San Francisco, California, US |
|
Industry |
Transportation (Ridesharing) |
|
Number of Funding Rounds |
27 (Currently) |
|
Total Funding Amount |
$4.9B |
|
No. of Lead Investors |
13 |
|
Number of Acquisitions |
11 |
Current Market Stats & Facts About Lyft
Launched in 2012, Lyft now ranks among the top ridesharing and transportation networking companies. To date, it has gained popularity and attracted thousands of users every day.
The following are the current market stats and facts about apps like Uber and Lyft that recites their growing importance in today’s time.
- Lyft went from 22 to 33% market share in the U.S. between 2017 to 2018.
- Around 4-5, Lyft rides out of 10 starts or end in low-income areas.
- Around 2 billion rides in the US were taken using ridesharing services.
- Lyft drivers earn around $34,400 every year.
- Lyft’s net worth is around $14.93 billion.
- As of September 2020, Lyft is the second-largest ridesharing service provider in the U.S., accounting for 31% market share.
- By the end of 2021, Lyft had 18.73 million active riders.
We hope these stats are evident enough to showcase the importance of Lyft business model in today’s time. If you are satisfied enough and plan to develop a car-sharing app like Uber or Lyft, let’s start with the business model.
Lyft Business Model: How Does the Application Work?
Ridesharing apps like Uber and Lyft work on a peer-to-peer (P2P) business model that provides a platform to connect drivers and riders. But, the question is, how does an app like Lyft work? Here’s the working procedure.
Lyft Business Model for Riders
Lyft application help users get a ride at their doorstep. Here’s how it works –
- Request A Ride
To start using the Lyft app, users need to download the app and register on it. After successful sign-up and registration, users can request a ride and choose from the options available, i.e., Rentals, Bikes & Scooters, Priority Pickup, Preferred Mode, Lyft XL, Lyft Lux, and Transit.
- Finding Nearby Driver
As soon as the user makes a request, the app starts searching for nearby drivers. Once it is confirmed, the details are displayed on the user’s screen.
- Track Ride
The Lyft business model has a map-based interface that empowers users to track the vehicle and ride as well. This Taxi booking app development feature ensures live tracking throughout the trip.
- Make A Payment
Lyft has multiple payment options for users, such as Apple Pay, PayPal, Venmo, Credit Cards, Google Pay, and more.
So, when you work on taxi booking app development, try to use secure payment gateways to enable users to pay hassle-free and securely.
- Give Rating
Finally, the app users or riders can rate the driver on a scale of 1 to 5 based on the ride experience. This gives more credibility to the drivers and helps them gain new users’ trust.
So, this is how the Lyft business model works for the rider’s panel. Now, let’s move to the driver’s panel.
Lyft Business Model for Drivers
Lyft offers a drive program for drivers who don’t own a car. Here’s how the process works-
- Enable the Driver Mode
After successfully downloading the app, drivers can turn on the driver mode to get online taxi booking requests.
- Accept Ride Request
Drivers get the rider’s pickup location. They can either accept or reject the ridesharing request received on the application.
- Start & Complete the Ride
After accepting the ride, the driver gets the pickup location and can begin the ride. Once the ride is complete, drivers can mark the same on the application.
- Receive the Payment
After ride completion, drivers get the payment within 1-2 hours via the Express Pay program. Also, drivers can register for a Lyft direct debit to get instant access to their earnings.
- Give Rating
Drivers can also rate the riders the same way they do based on their riding experience and behavior.
So, this is how the Lyft business model works and makes it easier for the users to ride right from their doorstep and enable businesses to earn huge business profit.
In case you are still confused and can’t develop an app on your own, it is advisable to consult a taxi app development company and, professionals. The model is created in a way that businesses can earn a huge business profit than expected.
Lyft Revenue Model: How Can Businesses Make Money?
Besides wondering about the cost to develop a taxi app, most businesses wonder about how Lyft business earns earn money or revenue. Do you have the same concern? Read this!
|
Year |
Revenue |
Profit |
|
2017 |
$1 billion |
– |
|
2018 |
$2.1 billion |
$911 million |
|
2019 |
$3.6 billion |
$2.6 billion |
|
2020 |
$2.3 billion |
$1.7 billion |
1. Surge Pricing Revenue Model
Lyft has heat maps that are location and time-specific depicting regions with high demand. It means that whenever there is high demand in a specific region, Lyft raises the prices temporarily to maintain the demand and supply balance.
So, when you create a taxi app like Uber or Lyft, keep this factor into consideration.
2. Commission-based Revenue Model
Whenever drivers complete their ride, Lyft releases money to the driver. The organization keeps 20% of the amount for every ride, and the rest goes to the drivers.
3. Multimodal Revenue Model
Today, Lyft has evolved into a multimodal on-demand transportation platform with four essential transportation modes.
They are – Bikes & Scooters for shorter rides, Public Transit, Ridesharing Marketplace, and Autonomous Vehicles.
4. Subscription-based Revenue Model
Lyft provides a subscription program known as Lyft Pink for riders. The app unlocks unlimited invaluable benefits for riders, including 15% off rideshare, discounted scooter rides, free ride relaxations, and more at just $19.99/month.
This is how the Lyft application generates revenue and benefits both the company and the drivers associated with the application. The same revenue model is applicable for car rental website development and other models.
How to Develop A Successful Ridesharing App Like Lyft? Must-Have Features
As soon as businesses plan to develop a ridesharing app, the very first question that strikes their mind is, how to develop an app like Lyft? If the same question is striking your mind, you’ve reached the right place.
The following are the essential features and benefits of a Taxi booking app like Lyft that will make your app successful.
User Panel
This panel is accessed by the users who are about to book a ride using a ridesharing app like Uber or Lyft.
- Quick Sign-up
Users can quickly create an account on a taxi app like Lyft either manually or using any social media account.
- Search A Ride
When users search for a ride, they can apply filters like car type, fee, optimal date, preferable route, and time.
- Geolocation
Enabling geolocation is one of the key factors of Lyft business model. It helps both users and drivers identify drop-in and drop-off locations on the map.
- Book A Ride
Once the users find the right option, they can book a ride. They can also track drop-in and drop-off locations while knowing the number of passengers traveling along.
- Review Passengers
While booking a ride, users can check other passengers’ profiles with ratings to experience a safe riding experience.
- Push Notifications
Timely notifications are essential to notify users about the riding status, including number, car model, travel time, etc. It increases the visibility of your taxi app and ultimately increases the profit and revenue.
- Real-time Tracking
This amazing feature of taxi app development enables users to track their ride status and driver detailsreal-timetime. Also, users get timely notifications of the same.
- In-App Chat & Call
This feature comes in handy in case of emergency, changes, or clarifications required before the trip begins.
- Online Payment
Users can register their credit cards on the ridesharing app and make cashless payments within the app.
- Reviews & Ratings
The taxi app solution feature lets users leave their opinions and add remarks once the ride is finished.
- Customer Support
Satisfying customers is essential for improved business profit and success. So, this feature allows the riders to address their complaints, suggestions, and questions here.
This is all about the amazing features of taxi app development for the users’ panel. Now, let’s take a look at the driver panel features.
Driver Panel
This panel is accessed by the drivers associated with ridesharing apps like Lyft or Uber.
- Sign-up or Registration
Signing up on the business app should be easy and secure so that drivers can easily sign-up on the taxi booking app.
- Profile Verification
As soon as the drivers register on the application, it is verified to check the driver’s credibility.
- Accept Or Reject A Ride
When the user books a ride, the driver gets notified of the same. They can either accept or reject the ride request depending on the availability.
- GPS
This amazing feature offers drivers the best route options while indicating traffic jams on the way and serves as a guide to help drivers reach the riders on time.
- In-app Chat & Call
Like the users, sometimes drivers also need to call the riders to get the exact location or notify them about the arrival. So, including this feature is an essential part of Lyft business model.
- Receive Payments
Drivers can also register payment cards to conveniently receive payments via secure payment gateways.
- Reviews & Ratings
Once the ride is complete, drivers can leave valuable feedback based on rider behavior and riding experience.
Admin Panel
- Dashboard
A well-managed dashboard feature helps the app’s admin to keep an eye on the activities of both the user and driver panel. It is one of the essential features to include while working on taxi app development.
- Analytics
Using this feature, the admin can get an insight into the application’s analytics, revenue streams, income, and more.
- Passengers
Whenever any new passenger creates an account on an app like Lyft, the admin gets notified about the same and all the passenger details.
- Drivers
Admin gets the right to accept new drivers’ registration and store the profile details, reviews, and ratings.
- In-app Payments
All the in-app payments with the details, drivers’ names, and everything are recorded here and can only be accessed by the app’s admin.
These are some of the must-have features businesses can include to successfully create a ridesharing app like Lyft. Even the mobile app development company professionals suggest implementing these features in the Lyft business model.
Summing Up!!!
Lyft has marked its presence in the ride-hailing industry and competing neck-to-neck with Uber. Initially, it started as a program under Zimride and now is one of the best ridesharing applications.
Today, the app has gained traction and is earning profit and revenue at lightning speed, and a result, businesses are planning to offer taxi app solution like Lyft.
So, if you are also planning to develop a taxi booking app like Lyft, now is the right time to step into the development process. It is advisable to take assistance from a reliable taxi booking app development company where experienced professionals work.
