Another App-based Transport Service - Lyft - Coming to RI Later This Week

Mar 18, 2014

In a sign of the growing battle between app-based transportation services, Lyft -- which lets consumers decide how much they want to pay for a ride -- is launching in the Providence market on Friday.

While Lyft bears a few strong similarities to Uber, which came to Providence last September, Lyft spokeswoman Paige Thelen says the company emphasizes an "in-person experience" and is about "building a community."

"We like to describe Lyft as 'your friend with a car,' " Thelen says. "Drivers are using their own vehicles and driving when they have a few extra hours per day. The passengers are encouraged to sit in the front seat. Each Lyft drive begins with a fist bump to start the conversation, and [the car of] each driver also has a white pink fluffy mustache on the front, so you know exactly who your driver is when they arrive."

Such groovy marketing notwithstanding, Lyft shows how there's serious money to be made in the growing business of app-based transportation. Lyft filed for $150 million in new VC funding earlier this month. Lyft was reportedly offering 30,000 rides a week within a year after its launch (with backing from Internet pioneer Marc Andreesen) and Providence will be the company's 26th market. In May 2013.

Lyft is privately held and based in San Francisco.

Thelen says Lyft is coming to Providence because it's seen as a tight-knit community with a lot of students.

Asked about the company's competitors, she says, "This isn't a zero-sum game. We believe that it's important for consumers to have options when it comes to transportation. We believe Lyft is a friendly and affordable and safe option, but other options like public transportation or taxis are also important for the community as well."

Lyft drivers receive voluntary payments, keeping 80 percent of the amount, while the 20 percent goes to the company. Thelen says Lyft's app encourages users to make a donation based on the time and distance of their trip, with an average cost of $8 to $10, although consumers can raise or decrease that amount based on their experience. "We actually find that most of the time passengers leave more than their suggested donation," she says.