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1) So $LYFT is paying $AMZN's AWS roughly 3.7% of their revenue per trip. $.14 per ride per @rrnn calculation vs. $3.75 revenue per ride from @modestproposal1 helpful breakdown of Lyft's unit economics/S-1.
2) Interesting to frame this relative to credit card processing fees of 2%ish. 3.7% for AWS seems like a good deal! Would also be interesting to know what $FB and $GOOGL’s effective "take rate" was.
3) Suspect that Lyft's spend on both $FB and $GOOGL ads is effectively over 8% per ride given that marketing expenses overall are 33% of revenue (obviously AWS more explicity tied to each ride). Assuming that $FB and $GOOGL are 50%ish of $LYFT total ad spend seems reasonable.
4) Curious to put together a generalized P&L for e-commerce co’s. i.e. On average what do they pay for cloud computing, $GOOGL ads and $FB ads as a % of revenue.
5) The fact that most e-commerce co’s run LTV to CACs around between 4 to 1 and 2 to 1 suggests that $GOOGL and $FB ads are taking a much larger % of e-commerce economics than cloud computing. And this is likely true for many other industries as well.
6) Goes to the point that internet advertising will be a much larger market than anyone is currently modeling. i.e. Even $GOOGL’s recent $1 trillion advertising TAM figure from the Morgan Stanley conference and highlighted today by Brian Nowak is way too low.
7) In the pre-internet world, the IT market was multiples larger than the advertising market. Suspect that in 10-20 years, these markets will be much closer in size. Will have more on this in a separate thread sometime.
8) Also – changed my Twitter username for arcane reasons. Cool that Twitter lets one do this. I’m now @GavinSBaker rather than @bakergavin.
