4 ms·

What? AirBnB's valuation is 25B. It could make a trivial dent in the worldwide hotel market and crush that valuation many times over. Uber is 50B. The globa

What? AirBnB's valuation is 25B. It could make a trivial dent in the worldwide hotel market and crush that valuation many times over. Uber is 50B. The global taxi market alone is worth many multiples of 50B, and that's not counting all the delivery services, bus/public transit-replacements etc that Uber is pushing for. I'm not saying these companies WILL capture all of their current markets, but it's ridiculous to say the valuations wouldn't be supported if they captured the whole market.

sly_foxx 11y ago
These hypothetical situations need to be taken with a grain of salt. Many big companies have tried expanding and taking over other markers, unrelated to their core business - they usually fail or acquire a company in that space(e.g. Google-YT; Facebook-Instagram etc.)
- tracker1 11y ago
  I think that Uber could make a killing as a general delivery service... If you included smaller "hand-offs" for drivers around town, they wouldn't match UPS/Fedex for remote distribution, even overnight, but could definitely be a boon for local businesses.
voronoff 11y ago
Many multiples? Try two to three, currently. "For instance, there seems to be a consensus that the most lucrative cab market in the world is in Japan, where yearly revenues are estimated to be about $20 billion to $25 billion just in Tokyo, followed by the United Kingdom with revenues of $14 billion, the bulk from London, and the U.S. with $11 billion overall and about $3 billion in New York. Assuming taxi revenues in the rest of the world add another $50 billion to this total, I arrive at a total market of $100 billion." http://fivethirtyeight.com/features/uber-isnt-worth-17-billion/ http://fivethirtyeight.com/features/uber-isnt-worth-17-billi...
- adventured 11y ago
  Uber won't capture merely the value of the US cab market, they're going to vastly expand it. People are already using Uber for things that they would never otherwise have tried to hail a cab for due to either cost or inconvenience or annoyance. It has significantly opened up the potential scale of the US taxi market, and will continue to do so. Uber's use is also blatantly going to broaden beyond the classic taxi market, whether that's to autonomous (which will again drastically increase the size of the market by bringing down the cost) and or deliveries. You might as well pretend AirBnB is only trying to capture the hotel market's value. When in fact they're vastly expanding upon it while simultaneously taking market share away from hotels.
  - at5 11y ago
    In the hedge fund industry we have a saying, pigs dream of flying and get slaughtered
  - AlexandrB 11y ago
    Even if all this is true, that assumes that no competitors appear and undercut/outcompete Uber. There's no stickiness here - a competing car service would be just an app away.
- superuser2 11y ago
  Uber stands to gain more than the cab market. It steals trips from car ownership and public transit that were never going to be traditional cab rides (cost, inability to hail in less dense neighborhoods, hour plus wait and piss-poor reliability of calling dispatch, etc).
- mrgordon 11y ago
  Assuming those numbers are all true, we still need to lump in all of the other delivery services and other verticals that Uber/Lyft are attacking. Then on top of this you've computed $100 billion per year which can easily justify a $50, $100, $150 billion valuation since you'll in theory be getting that $100 billion every single year
- tracker1 11y ago
gist 11y ago
> AirBnB's valuation is 25B. It could make a trivial dent in the worldwide hotel market and crush that valuation many times over. How defensible is the model when then either don't own the real estate (even McDonalds is famous for making money this way) or have contracts to manage the real estate (as many hotels that are now management companies do). Right now they may seem to own both the people who have places to rent and the people who want to rent but in no way is that as solid as having actual hard assets (or even long term contracts and most importantly a hotel brand). Or even in the case of an Amazon warehousing and logistics (or owning actual data centers).

sly_foxx 11y ago

These hypothetical situations need to be taken with a grain of salt. Many big companies have tried expanding and taking over other markers, unrelated to their core business - they usually fail or acquire a company in that space(e.g. Google-YT; Facebook-Instagram etc.)

tracker1 11y ago
I think that Uber could make a killing as a general delivery service... If you included smaller "hand-offs" for drivers around town, they wouldn't match UPS/Fedex for remote distribution, even overnight, but could definitely be a boon for local businesses.

voronoff 11y ago

Many multiples? Try two to three, currently. "For instance, there seems to be a consensus that the most lucrative cab market in the world is in Japan, where yearly revenues are estimated to be about $20 billion to $25 billion just in Tokyo, followed by the United Kingdom with revenues of $14 billion, the bulk from London, and the U.S. with $11 billion overall and about $3 billion in New York. Assuming taxi revenues in the rest of the world add another $50 billion to this total, I arrive at a total market of $100 billion." http://fivethirtyeight.com/features/uber-isnt-worth-17-billion/ http://fivethirtyeight.com/features/uber-isnt-worth-17-billi...

adventured 11y ago
Uber won't capture merely the value of the US cab market, they're going to vastly expand it. People are already using Uber for things that they would never otherwise have tried to hail a cab for due to either cost or inconvenience or annoyance. It has significantly opened up the potential scale of the US taxi market, and will continue to do so. Uber's use is also blatantly going to broaden beyond the classic taxi market, whether that's to autonomous (which will again drastically increase the size of the market by bringing down the cost) and or deliveries. You might as well pretend AirBnB is only trying to capture the hotel market's value. When in fact they're vastly expanding upon it while simultaneously taking market share away from hotels.
- at5 11y ago
  In the hedge fund industry we have a saying, pigs dream of flying and get slaughtered
- AlexandrB 11y ago
  Even if all this is true, that assumes that no competitors appear and undercut/outcompete Uber. There's no stickiness here - a competing car service would be just an app away.
superuser2 11y ago
Uber stands to gain more than the cab market. It steals trips from car ownership and public transit that were never going to be traditional cab rides (cost, inability to hail in less dense neighborhoods, hour plus wait and piss-poor reliability of calling dispatch, etc).
mrgordon 11y ago
Assuming those numbers are all true, we still need to lump in all of the other delivery services and other verticals that Uber/Lyft are attacking. Then on top of this you've computed $100 billion per year which can easily justify a $50, $100, $150 billion valuation since you'll in theory be getting that $100 billion every single year
tracker1 11y ago

gist 11y ago

> AirBnB's valuation is 25B. It could make a trivial dent in the worldwide hotel market and crush that valuation many times over. How defensible is the model when then either don't own the real estate (even McDonalds is famous for making money this way) or have contracts to manage the real estate (as many hotels that are now management companies do). Right now they may seem to own both the people who have places to rent and the people who want to rent but in no way is that as solid as having actual hard assets (or even long term contracts and most importantly a hotel brand). Or even in the case of an Amazon warehousing and logistics (or owning actual data centers).