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Uber offers good signup discounts and low rates when they enter a market, but they're also making huge profits in mature markets. They have a business model. I
by morgante 11y ago
Uber offers good signup discounts and low rates when they enter a market, but they're also making huge profits in mature markets.
They have a business model. It just takes capital to spin up new markets. (They run a market at a loss initially, until its mature enough to take profit from.)
- timr 11y agoUnless you have access to some current insider financial data that you're leaking here, you're assuming that they're making "huge profits" in mature markets, and you're further assuming that those mature markets can cover everything else. What we know from observable evidence is that they're raising tons of money, and funneling it into growth. We also know that there are lots of subsidies, on both sides of the market -- even in San Francisco, the most mature of Uber's markets, I regularly see and hear of driver referral bonuses. It could well be that without the easy money, the Uber story becomes a lot less compelling. Time will tell.
- nostrademons 11y agoI think he's referring to financials that were leaked a year and a half ago, covering SF, DC, and other market-by-market breakdowns: http://www.businessinsider.com/uber-revenue-rides-drivers-and-fares-2014-11 http://www.businessinsider.com/uber-revenue-rides-drivers-an...
- timr 11y agoYeah, I figured, but that's pretty old information by now. In particular, it predates the company's massive spending in China, and increased competition in the mature markets that have been effectively deregulated (e.g. NYC). One of the ironic things about Uber is that after they overcome regulatory hurdles in new markets, they make business dramatically easier for their competitors. Taxi service without regulatory capture is a commodity product.