Business Model
The rosy model of transportation revolution only works in limited crowded cities where
- People don't own cars
- People can't afford parking and live far from underground transportation entrances
- Lack of underground transportation systems
- People can afford surged prices
Or as last mile solution to public transportation system.
Big challenges ahead:
- Excessive burn rate that requires billions of dollars injection every year
- Highly inflated and unsustainable eco-system. Both riders and drivers are lured to systems by promotions, incentives and credits, particularly true in countries supported company's hyped growth
- Drivers are paid barely higher than minimum wage given the gas and car ownership cost, large percent drivers leave the platform after a few weeks or months. Constant high cost to recruit new drivers.
- Increasing competition from not only tech companies, but also car manufactures, taxi companies.
The model may work when autonomous car on road, which eliminates drivers from the ecosystem. At the same time, it will make every car manufacture a competitor. Tesla, VW, Toyota, Audi, GM etc will join Apple, Google, Amazon to fight for market share. The winner would be a tech savvy car maker or a joint venture from a tech giant and car maker. Making autonomous car is a bigger challenge than building a ride sharing platform.
Car is commodity, but autonomous car is true innovation. Ride sharing platform is less complicated than many high traffic systems today, the realtime dispatch component is likely be the trickiest, which heavily relies on map and realtime traffic report.
Map developer owns the most important ride sharing static (map) and dynamic data (realtime traffic), will eventually rule the ride sharing platform.
Uber is ambitious and chose to work on everything in house including autonomous car, map. Progress would be more significant if partner with industry leaders.
Uber's NA market is slowing down, China is much smaller than DiDi but bleeding heavily, no sign of relief anytime soon.
Culture
Toe stepping is encouraged with good intention, but many use it to attack others, there is no team work under unexperienced first line, second line management, managers don't have right judgement and integrity to tell when a stepping is good, when is bad.
Surviving first year is hard, particularly reaching to anniversary. You may let go right before your stock vesting date. People work "HARD" to show they are busy, but extremely inefficient from business impact point of view. Tons of reports, charts, but not much truth finding and problem solving. Employee will be trained to become a talker, ppt/report maker, and an attacker to survive.
No exit for stock holders, CEO has publicly said to delay IPO as long as possible. Each round of funding dilutes shares.
