Lyft CEO and president step down to be replaced by former Amazon exec

Image Credits: Lyft

UPDATE: This article has been updated with information about compensation packages for Green, Zimmer, and Risher.

Lyft co-founders, CEO Logan Green and president John Zimmer, will step down from their positions in mid-April, the company said Wednesday. They will serve as chairman and vice chairman of Lyft’s board, respectively.

David Risher, former retail manager at Amazon, is taking over as CEO at Lyft. Lyft’s current chairman, Sean Aggarwal, will step down from his position but will remain on the board.

Green and Zimmer founded Lyft in 2012. At the time, the company was mainly distinguished from Uber by the presence of pink mustaches on Lyft vehicles. At the time, Zimmer told TechCrunch that Lyft originally thought of doing the service only for women, “as a kind of security service and a very specific clientele.”

Lyft ditched the mustache in 2016 and went public three years later. When it debuted, Lyft raised more than $2 billion in an afternoon after pricing its shares at $72 each. Today Lyft closed at $9.60 a share; however, the stock price rose nearly 6% after hours on the news that Risher took over as CEO.

Risher joined Amazon in 1997 as the company’s first VP of product and store development. He rose through the ranks alongside Amazon founder and executive chairman Jeff Bezos, serving as SVP of marketing and merchandising before leaving Amazon in 2002. everything store” with sales of more than $4 billion, according to a statement from Lyft.

Today, Risher is the CEO and co-founder of Worldreader, a non-profit organization that aims to get children interested in reading. Perhaps it’s this community-oriented spirit that ties in well with Lyft’s original founding goals as a company. According to a post on LinkedIn, he will step down as CEO and remain as chairman of the board.

Risher, who joined Lyft’s board of directors in 2021, will assume full leadership responsibilities for the company’s operations on April 17, according to the company.

Lyft said there would be no change to the company’s previously announced revenue, contribution margin and adjusted EBITDA outlook for the first quarter of 2023. When Lyft shared its fourth quarter and full year 2022 revenue in February, the company cut its revenue expectations for the first quarter of 2023 to $975 million, down about $200 million. Analysts had expected the company to promise $1.09 billion in revenue. That guidance caused the shares to fall 25% in after-hours trading to $12.13, and they’ve continued to fall in the intervening weeks.

A fee

According to SEC filings, Lyft pays Risher an annual salary of $725,000, with an annual target bonus opportunity of 100% of that salary for each fiscal year he works at Lyft, based on meeting certain performance goals. This year, however, his annual bonus will be $1 million as long as he stays with the company until mid-March 2024. Risher will also receive a $3.25 million signing bonus. The new CEO’s compensation package includes a performance-based restrictive stock award, covering a total of 12.25 million shares, which Risher may acquire upon the achievement of certain share price targets.

Green and Zimmer will each receive $450,000 in cash for their position on the board. They both retain their original award agreements on a predetermined timeline as long as they remain service providers of the Company. If they are laid off, that timeline accelerates and they can access their equity incentives as defined in Lyft’s 2019 equity incentive plan. In addition, each will receive a limited stock grant covering a number of shares of Lyft’s stock valued at $260,000, effective as of the date of the company’s annual meeting of stockholders.

And despite the shift in day-to-day operations, Lyft’s dual-class structure continues to empower Green and Zimmer long after they leave the company. They both still hold high-voting shares entitled to 20 votes per share up to both are dead. If someone dies or becomes incapacitated, Lyft’s lapse clause allows the surviving co-founder to control the votes of the deceased/incapacitated co-founder. And if they’re both dead, a trustee retains the full voting rights of the last living co-founder for a transitional period of nine to eighteen months.






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