Total Immersion Chaos.
Uber has been trying to fill the slots in its C-suite, but it’s not easy. Meg Whitman keeps sticking to her story that she won’t be the next Uber CEO. “What Part of No (Don’t You Understand),” she told the Wall Street Journal today. CFO Brent Callinicos left in 2015. The next guy in line, head of finance Gautam Gupta, wasn’t promoted to the slot and left last month. The board is also looking for a COO. A bunch of other executive and managers have left or were booted out, and the 14-member executive committee that is running the show has got some hiring to do.
And it might get worse. For most of the second quarter, Uber still had its CEO Travis Kalanick, and the head of finance was there for all of the second quarter. And in the third quarter, without an executive team to lead the company through the turmoil, scandals, and legal issues, all heck has broken loose on the board, which, as Axios put it, has erupted into “open warfare.”
Now the company wants to let everyone know that its operations, at least in the second quarter, have not also collapsed.
Because it is privately held, Uber isn’t required to release financial results. It has nevertheless made a habit over the past few quarters to disclose limited financial and operational information – rather than see it leaked to the media anyway. And today, it handed select second-quarter results to Axios:
- Gross bookings doubled year-over-year to $8.7 billion.
- The number of trips jumped 90% in developed markets and over 250% in developing markets. Combined, total trips globally jumped 150%.
- “Adjusted net revenue” rose by 118% year-over-year to $1.75 billion.
- “Adjusted” net loss fell 8.9% quarter-over-quarter to $645 million and was down 14% year-over-year. This loss is before interest, tax, employee stock compensation expenses, and other items. The net loss under Generally Accepted Accounting Principles (GAAP) was not disclosed.
So Uber still lost a running ton of money, but less than in each of the past four quarters. Maybe cost cutting and its exit from China have something to do with it. This chart shows the “adjusted” losses before interest, tax, employee stock compensation expenses, and other items, in millions:
Uber, which has raised about $15 billion in equity and debt funding over the years, still had $6.6 billion in cash left at the end of Q2, down from about $7.2 billion at the end of Q1. So it’s not going to run out of wriggle room for at least a couple of years.
There have been rumors that the next round of fundraising would be a “down round” where Uber’s $68 billion valuation would get a big hair cut. Four mutual funds that own Uber shares have slashed the estimated value of their investment: Vanguard Group, Principal, and Hartford Funds each by 15% and T. Rowe Price by about 12%. Not exactly a glaring sign of confidence.
Part of the reason for the release of the albeit very select operational and financial data might have been the need to show to the world that the company is still holding up operationally despite the chaos it’s immersed in – that it’s in fact growing in leaps and bounds, that people are using the service more and more around the world, that it’s crushing taxis and rental cars, and that it’s offering some urbanites an alternative to owning a car, thus making even automakers nervous.
But the “adjusted” operating losses reported today don’t include the massive losses that Uber is facing from its subprime auto-leasing crisis. Two years ago when these now departed executives launched the subprime auto leasing program to put their badly paid drivers into shiny new vehicles they couldn’t otherwise afford, they apparently didn’t do the math, which is not unusual for a company that blows billions of dollars of investor money and doesn’t need to do math. Read… Uber Gets Run Over by its Own Subprime Auto Leases
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‘How did you go bankrupt? Two ways. Gradually, then suddenly.’
— Ernest Hemingway
Any business model that takes in 99$ and gives back 100$ will be very popular. No need to see the financial statements.
Btw, who is steering the ship at Uber now? If I get groped by a coworker at Uber, will I at least have the HR to complain to? Not that the HR seemed to make much difference…
While Uber clearly continues to burn money, I am curious to know if the conditions for drivers have improved since Uber allowed tipping. I only take Uber/Lyft when a traditional cab is not readily available (somewhat often depending where you are in a metro). My most recent trip from the office in Philly to the train station cost me and my colleauges $7.52 for the Uber ride. For the first time ever I could tip my driver via the app and did (I have tipped cash in the past, but that’s harder to reimburse). Allowing tipping certainly reduces their edge, but I have to think it makes life better for the drivers.
Since tipping via the app started (June?), customers paid $50 million in tips, Uber said. If 250,000 drivers in the US received those tips, each driver on average got $200 in tips in total over the two to three months. So it’s not huge.
Never used uber so I am a bit clueless here, but allow tipping? How can they stop you slipping the driver a note or 2 cash? And given the track record of this lot how can you trust your additional credit card tip actually gets to the driver?
Some people won’t tip if they can’t voucher it.
And why do I tip? That’s the old model of personal service. Now I simply want to know the price and get it done. If you can’t make a decent living just doing and getting paid then the alternative is just don’t do it. I don’t tip my poolboy, my lawyer, my accountant or the cashier at Walmart.
Larry – This link is a good window into the lives of Uber drivers
https://www.reddit.com/r/uberdrivers/
BTW “pax” means passenger or passengers. It goes ‘way back, decades so it’s not some new Uber-speak.
Wolf,
I love your blog. However Uber is not going to it shut down simply because their burn rate is increasing and they still have a lot of cash on hand.
While their evaluation valuation may go down a lot of people still want to put money in Uber.
I used to believe like you do. However I’m open to the idea that the abnormal is The New Normal and therefore we need to realign our thinking and how the new businesses volvik in the rest of the 21st Century. Why this is counterintuitive and against every economic theory to keep losing money and be alive but maybe QE and the flood of free money has up ended the normal business cycle such that we are in the Twilight Zone of economics.
Or as the theoretical physicists would say we are living in an alternate reality where antimatter is the matter and matter is antimatter.
So Uber is correct in telling us that it is not collapsing.
Personally however I still have a hard time reconciling all the absurdities in the macroeconomic sphere and the stock market that I see. I’m inclined to slowly learn the new models and accept them as being true.
I agree, Uber is not collapsing. I didn’t mean to sound cynical about this. They have booming revenues and $6 billion in cash, and they’re wiping out their competition (taxis and short-term rentals) – which I emphasized. Plus, for now, a lot of investor goodwill (even if valuation gets cut, it’s still high) will allow them to raise more money when they need to, and they will.
There are some huge problems with this business model, but for now, investors are willing to fund those problems.
6 billion in cash ? In comparison to how much debt ? ( short answer : a helluva lot more than 6 billion ) And what guarantee do we or the investors have that that 6 billion is even remotely accurate in light of our rather liberal to the point of fantasy accountability regulations ? Suffice it to say just because cognitive distortion is currently reigning across the financial investors landscape is no guarantee Uber will survive their self induced financial black hole . It may take a bit of time … but sooner than later reality will catch up . Though like all pyramid schemes all bets are those at the top will walk away flush .
Their financing is solid: Of the $15 billion Uber raised in its existence, $14 billion was equity, not debt. But in 2016, it obtained a credit facility of $1 billion to finance the misbegotten subprime auto leases that I mentioned in an earlier article (from a consortium of banks including Goldman Sachs, J.P. Morgan Chase, Citigroup, and Morgan Stanley).
So the $6.6 billion in cash weigh against $1 billion in debt. This is what Silicon Valley is all about: equity capital.
It’s doesn’t have to be a pyramid scheme to be flawed. The old ideas of return on investment, earining a profit are not old they are current and will continue to be current. Otherwise there is no business – just a hole in the ground. Investors will get back to proper returns for the risk, otherwise they lose all their money. It’s just the time frame, not the eventuality.
Just saying:
$600 million loss per quarter and $6 billion in bank -= roughly 10 quarters…before you need “new sucker” money
Maybe Bezos will take an interest
Bezos is already in.
https://www.quora.com/What-percentage-of-Uber-does-Jeff-Bezos-own
Re: “Twilight Zone of Economics,” can’t help but copy/paste my comment about Uber from another blog post…There’s a film from last year called “San Francisco 2.0,” one guy made the following comment which observes that you can get away with just about anything in this new economy so long as it’s done under the guise of “the miracle of technology” — “If anyone else came along and said ‘I’m gonna create a new taxi service,’ the union would have been like ‘you cant do that…you want drivers that have never been tested and you don’t want insurance…no, you can’t, that’s not a good idea.’ But, as soon as you hold it up [holds up phone] and say ‘Look, it’s on an iPhone!’ ‘Oh, it’s on an iPhone? That’s amazing! We should absolutely have this! That’s awesome, what else can you do on iPhone, this stuff is amazing!’”
Maybe I should apply?
I can run the business into Chapter 11 more effectively in a unique and entertaining way and all this for much less compensation than the previous CEO.
Uber is merely a scheme to:
• lay off the capital and operating expenses onto the drivers who aren’t paid enough to make a living not to mention not being able to cover their capital and operating expenses; and
• to temporarily evade all of the regulations that apply to public transportation for hire (taxi cabs).
So, really how can Uber NOT collapse?
Because there is an endless stream of new suckers (drivers). They might not be as dumb as they seen. I suspect a lot of the ones I get don’t have papers or language/other skills to get a regular job. Probably the car is leased and they are not planning to pay the extra mileage charges.
Regular jobs are worse then being an Uber driver at the low end anyway. At least the Uber driver doesn’t have to wear a ridiculous uniform and stand up all day.
Plenty of professionals with college degrees do it out of desperation, like this guy, https://www.fastcompany.com/3061620/zen-and-the-art-of-uber-driving. Lots of teachers doing it as well, http://www.educationworld.com/a_news/uber-capitalizes-teachers%E2%80%99-need-work-second-jobs-1247603571. I myself debated doing it but decided it wasn’t worth trashing my borderline-too-old car.
That Fast Company article is pretty good. From the article:
” When you’re falling straight down the financial cliff face, you reach out to grab hold of anything available to stop your descent and there, just before you land in a homeless shelter or move in with your sister, is Uber.”
When I saw this result on Bloomberg, I thought they were talking about the annual result being a 645 million dollar loss not quarterly.
How can a glorified taxi company lose that much money?
I’ve heard of cash burn in new companies but this just sounds like the business model is completely wrong.
Hey the company is growing though lol.
Last year Lyft, Uber’s major competitor outside of Asia, announced a loss of US $600 million. Lyft is valued a small fraction of Uber: $7.5 billion vs $69 billion. Yes, these are theoretical dollars, but always remember we live in a world where even supposedly smart people thought Theranos was a good investment.
So over $600 million/quarter for a company the size of Uber is perfectly possible.
I had a similar reaction when I learned last year Just Eat reported a loss of £20 million. As a publicly traded company, they have to report financials.
Just Eat is described as “an intermediary between independent take-out food outlets and customers”. Their delivery men are mostly self-employed. In short few assets besides an app and some trademarks. Yet they managed to lose £20 million in a single year.
Great reply MC.
Agreed Just Eat to lose 20 million dollars is bizarre.
Was it all advertising spend to raise the brand?
Regards
Steve
Just Eat has been an M&A Queen among FTSE 250 companies, and it hasn’t spent pocket change.
The acquisitions of Hungryhouse and SkipTheDishes last year have been the stuff of legend: the former went for £200 million and the latter for £65 million. Again, these are companies with little in the way of tangible assets: Just Eat chiefly bought them to have instant growth and to momentarily get rid of a competitor.
The bulk of this was paid in equity and by dipping into the cash provided by generous funds such as Vitruvian Partners and Redpoint Ventures, but still some cash was required. This is on top of the usual expenses such as sponsorships, marketing etc.
Carsharing and food delivery services may be fast growing sector, but cutthroat competition between ultra-aggressive, extremely well financed startups makes sure margins are rice-paper thin and that acquisitions are always enormously overpriced: when is Hungryhouse gonna pay itself back? The answer is most likely never: a short term boost to equities was the only tangible result, and it was achieved in enormously inefficient fashion.
Yes, this version of the dot.com adventure (bubble?) seems to be about disrupting old industries. However, I am not sure there is much disruption. Calling cab by phone? not that new. A better way to do blood testing (Theranos)? not really.
I guess there will be something of lasting value to come from these business activities, but it’s hard to see it now.
I’ve been coding since 1973 (for physical science), and never did see the big appeal to the entertainment from computers- games, smart phones. I still don’t, but I am still using lots of computers in my job.
I’ve rented a few cars recently. Dirt cheap. I guess I can thank Uber for that anyway.
wkevinw – So, your favorite computer game is …. Labview? :-D
They lost a couple billion in China trying to compete with government favored entities and being ripped off by drivers on promotional schemes.
Ah yes, DiDi Chuxing. Does anyone else feel like their 100 million monthly users are a classic case of “fanciful and completely man-made” data originating from China?
I have no problem believing DiDi may be pounding Uber into dust as far as raw numbers go, but 100 million users is over twice what Uber reports (around 40 million)… worldwide!
The difference between what we as a society will countenance viz. pay for corporate honchos and their retainers (think Uber, Telsa, Facebook, and the crooks in the fracking industry) who produce dreams of avarice and little else, versus what we will pay people to pick our crops, haul them to market, care for our grandparents, and teach our children is so shocking that I don’t think we can take it in. It just floats there, justified by a bankrupt neoliberal ideology and accepted by a population that has been taught to suspend all moral judgments in the face of the Holy and Omniscient Market. The most human of choices is, what is right, not, what should I buy.
George Carlin said, ‘it’s a big club and you’re not in it’… but you COULD BE- all you have to do is prove you can walk away from every shred of morality, ethics and fair conduct you’ve ever been taught. Selling your grandmother into debt slavery can help.
“If you tell a big enough lie and tell it frequently enough, it will be believed.”
Adolf Hitler
Such has been the basis of the American economic and political system for most of my lifetime. All lies are eventually exposed, however- how does one survive the consequences?
you have to separate the good lies from the bad lies
Hey. I am willing to lie and make evil choices. How come I ain’t rich? Cuz I ain’t in the club.
As far as Uber, they are playing the monopoly game (like Amazon). Get in their first, build up the brand, crush or buy out the competition. Then anybody wants to drive to make money they have to go through them. The only fly in the ointment is if some populist politician (not Trump) starts enforcing anti-trust legislation already on the books.
Frac Crooks ! A new menace!
Never believe a rumor until it is officially denied.
For a $20 ride it seems an Uber driver makes $15 to $17, no? So Uber makes $3 to $5.
What are Uber’s operational expenses? The software is written, its not in development. They apparently don’t need any marketing or advertising, as word of mouth seems to have done the job quite well. Do they need to have a physical presence in every city they operate in? Or in ANY city they operate in? Thus as far as I can figure, Uber is / could essentially be a massive server farm with huge accounting and legal departments, along with operations to deal with the drivers.
The drivers cover transport costs and the customers and drivers cover a large portion of the IT / Internet cost.
Thus I don’t get how Uber isn’t making money hand over fist.
That said, there’s a great podcast by Jim Grant (Jim Grant’s podcast “Taxi, Taxi” June 2, 2017) where he interviews a 20 year transportation analyst and who states just what Wolf is stating here, “Ubers a big loser”. Yet, he doesn’t go into the details of what exactly is costing Uber money. Which is my question, why don’t they make money? What are their insurmountable expenses?
The analyst on Grant’s podcast said that Uber failed to make the actual transportation of the customer more efficient than a traditional taxi company. I can see that. They have made the act of hailing a ride much more efficient for the customer, but they haven’t decreased transport costs much if at all.
But Uber is skimming a fair bit of driver revenue at huge scale. So how can they not at least break even?
I get that Amazon might not make a lot of money because it has to be so competitive on cost, but Uber seems to have a profit margin baked in from the % it keeps from the drivers fare.
What am I missing? Thanks
that’s a good question , why isn’t Uber making money . Their investment in ‘fixed assets’ are the software/hardware platform which maybe is not scale able. We can’t look at the income statement to discern since it is still private . I can only speculate that much expense(legal) is due to setting up new markets. Or running at a loss to gain market share driving competitors out.
The analyst on Grant’s prodcast said that Uber must become a monoply for its model to work. Perhaps not coincidentally, that sort of business model is built into the name itself, Uber. Sort of a double meaning, though in their case. I think of the German Uber Alles.
From Google:
What does the word uber mean?
1. A prefixal use of uber, adverb and adjective, with the basic meaning “over, beyond.” It is added to adjectives and nouns to form compounds ( uberstylish; uberchefs): a hyphen is sometimes used in new coinages or in any words whose component parts it may be desirable to set off distinctly ( uber-luxe).
Part of the cost of regular taxis is the rent that drivers (or cab companies) pay to owners of “medallions” or city licenses.The number of medallions has been limited in the past,so prices of medallions in certain cities have soared in price.But with the arrival of Uber and similar services,prices have plumetted from 1.3M in 2013 to $241,00 last March.
Services like UBER will eliminate the need for a “medallion” .To that extent ,they have definitely have brought down transportation costs
I think sites like NakedCapitalism covers the Uber issue, especially its economics better than this site. If you head over there and read the series of analyses made by Hubert Horan, it should be clear why Uber will NEVER make any money unless it becomes a monopoly. And even then service will eventually deteriorate and prices will skyrocket.
Thanks
I’ll check it out
Rates,
Checked out. That was awesome. Thanks.
Shades of the days of Carnegie (steel), Rockefeller (oil) and Vanderbilt (railroads)!. Will there be a rise of a trust-busting Teddy Roosevelt to rein them in??? Stay tuned for the next thrilling episode…
Wolf got it right with “But the “adjusted” operating losses reported today don’t include the massive losses that Uber is facing from its subprime auto-leasing crisis. ”
It’s mere selective unaudited disclosures by company not bound by Sarbane Oxley. That said recent mark downs by the mutual funds points to the inevitable down rounds for uber and other unicorns who just might die off when the easy liquidity dries off with next downturn in stock market – seen this movie before in 2008.
I bet their salary expenses will start rising. Anyone hired after this board turmoil isn’t going to be tempted by stock options that are worthless at current valuations. Which means they’ll need to be paid in cash. That said, this is likely a small portion of their expenses.
The bigger problem is that based on those numbers, their average revenue per trip is going down. This may be due to a higher share of trips in developing countries. But if it represents an actual decline in avg trip length / revenue, it’s a real problem. Talk to any uber driver and they say short trips kill their income; they really only make decent income on long trips. Which means uber will lose more drivers, or will need to subsidize them at a higher rate to retain them. Neither will be good for their bottomline.
Good point. $1 taxi rides in the 3rd world are not necessarily any cheaper to process than a $100 long haul in the USA. Not that it should cost much at all, as far as Uber is concerned… from my view in the cheap seats.
Why all this publicity regarding UBER
Read my lips
IPO
The only way that early investors can cash out is by selling their shares either in an IPO or the after market.
I do not mean to be cynic,but watch out for the “leaked news to suddenly improve after a new CEO is appointed and an IPO is rumored.
“When you publicly state what you’re worth, what do you base that number on?”
Trump: “I would say it’s my general attitude at the time that the question may be asked,” Donald responded. “And as I say, it varies.”
Welcome to Dot.com 2.0. Air biscuits.
There was some news this morning that the woman who quit Uber, over her sexual harassment claims, is petitioning the supreme court to review the arbitration clauses, that allow most companies to be shielded from legal action. She is petitioning for arbitration to be eliminated and class actions to be allowed. If she succeeds most of corporate America is doomed.
Is this a new sexual harassment case? It is getting so confusing to keep track of them. May be, Uber should merge with Caligula corporation to be renamed as Uber-Caligula.
Are there any blogs calling for an independent Ca ==> Wa independent
state referendum.
Is there any James Polk statue to destroy.
I’m sure investing in the purchase, storage, maintenance, and insurance of self driving cars to replace their drivers will return them to profitability.
/s
We are over-run with comedians for this joke of a company. ; )
a week ago on this site, i saw an ad in the upper right corner, for the new book, RAW DEAL: How the “Uber Economy” and Runaway Capitalism are Screwing American Workers.
i’m reading it now. i was wondering when someone who’s had to do their own quarterly taxes for freelancing would call this “sharing economy” out for how it’s whored us all out along with everything we’ve got.
i always thought i was the frizzy art chick who “feels” her way through life like a stumbling loud person. but now i’ve since learned that Petunia was right about po’ folks being the only ones who live and die by the razor thin realities of math in the actual world.
and i learned NO ONE does the math. they think it’s standard to spend $3 to make $2. you just try to outrun the math and leave it to your heirs i guess.
anyhow, regarding this RAW DEAL book– James said it’s like i’m reading Wolfstreet in paper (because Wolfstreet is the only site where i read beyond the headlines): i read in long binges. but as with Wolfstreet, you have to prepare yourself beforehand to read sci fi that is non-fictional current reality, and then shake it off afterhand.
it’s a dark read and even James, who was an engineer and is now making $18 an hour with kids who think this is as good as it’s gonna ever be, he’s reading it and had no idea things had gotten this bad surreal and illogical and small minded.
—
update:
https://www.zillow.com/homedetails/1330-Hampshire-St-San-Francisco-CA-94110/15152651_zpid/
i mentioned that the building across the street had been gutted as a single family home and re-done as a duplex condo situation. the top unit sold for $1,200,000 and they moved the staged ubiquitous b.s. grown folks high-end ikea furniture out, and it looks like a 5 year old kid took over: there’s a retro (analogue) air hockey or football table in the obligatory modern fishbowl window and you see bicycles and helmets to the side.
i wonder does he eat bowls of cheerios with too much sugar and watch saturday morning cartoons and gloat at his janitor neighbors across the street?
we woke up to a mound of homeless outside our door two days ago. that never was this bad.
i must confess here i was so disgusted that on my way to the gym i keyed the fancy car that covered our driveway like they had a right, and i left a note on their windshield with my name signed that i’d ticket them next time.
i didn’t go to college in the bronx like Petunia, but gradeschool and 2 weeks of junior high before i got kicked out and sent away.
i haven’t thrown anyone’s cell phone in at least a year now, and this was just momentary leakage or slippage from seeing such a little kid “fuck you” in a $1,200,000 picture window while we’re all fighting over what’s left below.
feudalism indeed. read that RAW DEAL book with alka seltzer nearby like sometimes when you binge read Wolfstreet or mainline the heavier comments sections.
I’ve been doing my own quarterly taxes for freelancing since 2002 and I’ve called it out as crap from day one (I actually call it the “share the scraps” economy, and these “gigs” are just more leftover scrap work). What’s sad about it and IMO makes it impossible to really address or fix is how little sympathy and how much outright sneering and condemnation people like myself get from those fortunate enough to have never suffered from a layoff once in their lives. My cousin had the smarts to go into computer programming back in the 1970s. He’s held two cushy jobs his whole life and will retire in a few years with a nice pension to supplement his SS. He has nothing but contempt for my plight, where my 1,500+ job rejections all boil down to my “negative attitude.” Yeah, right, whatever (insert rolling eyes emoticon)…
yeah, James and i have had to laugh at people telling us how “negatively” we see the work world. ALL of them are… freelancers now. and they got fat or chainsmoked from the stress.
i get scared because cubicle-bred people act so cool but they’re the first ones who lose their minds and panic. they get soft and lazy and …edible. like kobe beef.
(smile)
Rejected By Target – Are there Big-5 sporting goods stores where you are? (California chain) anyway I was offered a job at one yesterday. The kid helping me was making $17-odd, and frankly working at Big-5 would be kind of fun because I really like Big-5.
I told him I want to give this thing I’m starting a fair try, but if it all falls flat, I’ll sure look him up. Right now I don’t want my life to be all about Big-5 (or anyone else’s company).
I’m just saying, if Target’s rejecting you, there are a lot of other companies. I don’t know where you are, but there are lots of places hiring for the most oddball things in my area. I can ride my bike up to the corner and there’s a place with a sign always out, hiring for machine shop stuff like deburring etc.
In the SF Bay Area the weather won’t kill you, you won’t starve, and frankly there are jobs. Not $20+ an hour jobs unless you have experience in something, but there are jobs.
Thx but I’ve already got a plan (of sorts), I recently applied for a Czech business/freelance visa, had my interview at the consulate in NYC last month, they said it could take up to 90 days to get it, so now I’m just waiting with crossed fingers. If I get it the plan is to find a job over there teaching English. The way I see it, there are no opportunities here that would allow me to return to an independent lifestyle which is the most important thing, that means not living in my mom’s basement (something I will never be happy with).
oh man, “rejected by target” and “alex in san jose”–
you both are right about this BRILLIANTLY EMOTIONAL and TRUE “fast company” article!!! it’s so brilliant because no one writing about tech has ever cared about conveying the kind of PEOPLE they are and how we’re living out their dystopian visions that make them want to trash this place and head for mars. “libertarian” bents don’t do this rampant attitude that’s taken over the city and made us homeless slaves and whores, any real justice:
“This is Uber Black and the rules say you have to open my door for me.”
yup… at least the author still has balls and doesn’t part with them so easily like others seem to have already. THAT’s what chills me.
thanks. y’all read this for what SF is like now:
https://www.fastcompany.com/3061620/zen-and-the-art-of-uber-driving
I haven’t read the book and won’t, but I wonder if it discusses the Uber contractors that sub contract out their vehicles to other drivers in order to make it “profitable.” From what I understand, you need to keep the cars out there 24/7 to make it work out. One legitimate driver signs up and the others can be family or friends who share the income and probably the living arrangements too.
yes, he talks about them subcontracting and sharing accounts. i think one of the uber rapists was using his wife’s account and he had a sexual assault record. / he also says they don’t do ANY background checks like they claim they do. airbnb same story. and some people have been renting blocks of apartments and subleasing. one guy paid 20% over rent and still made bank re-renting ’em out and then the apartment owners just started evicting tenants and begging him to manage them for short term. i believe it was in nyc.
Uber is killing the rental car market as I often use uber on business in US and especially ride to and from airport. Switched to Lyft after bad experience with uber driver due to uber’s software glitch at SFO – I confirm the door # but uber driver was sent to wrong door #. The quality of car’s cleanliness and driver has been going down so latrely been using uber select as well since it’s expensed with more professional driver and CLEAN cars.
So what will you guys use instead of Uber when it crashes?