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It is not about regulated vs. unregulated industries: it is about centralized vs. decentralized regulations. The main reason - I can't remember the source wher

It is not about regulated vs. unregulated industries: it is about centralized vs. decentralized regulations. The main reason - I can't remember the source where I read it, somebody please share it if you know it - is that Uber exploited the decentralized regulation of taxi companies. Other companies - like Theranos, regardless of their actual efficacy in what they do - had to fight against centralized, national regulations in their specific industries and regulated statewide, therefore making them effortless against the entire country as opposed to Uber, fighting against local municipalities. edit: typos

toomuchtodo 11y ago
Uber may still have to deal with the IRS extracting taxes and penalties for worker misclassification.
- gcatalfamo 11y ago
  Sure, but it's not a barrier for growth like what other "Uber for X" companies had to face...the moment that may come about dealing with the IRS Uber might be equipped more than enough to deal with it without too much problems...
J-dawg 11y ago
This is a very interesting and convincing theory. The same could be said for AirBnB. So the question is, what other locally-regulated industries are ripe for disruption?
- jonny_eh 11y ago
  Real estate sales
  - J-dawg 11y ago
    I've discussed that very thing on HN before. Someone replied with "it's very hard to disrupt something that people don't do often". I think there's a lot of truth in this. Real estate sales seems to be pointlessly inefficient and overpriced, but it's something that people do a handful of times in their entire life, and they're willing to pay to have their hand held.
    - msellout 11y ago
      In fact, many people should pay more than they do -- get better lawyers, more thorough inspections, better negotiators, etc.
LukaAl 11y ago
Even if agree with you, centralized vs. decentralized makes a lot of difference, this is not the main point of the article. Centralized vs. decentralized influence your go-to-market strategy and probably your probability to succeed, but not directly your business model. The point made in the article is that the biz model of the "Uber for X" businesses is not very strong unless X is a heavily regulated market and you are able to skip part of the regulatory burden to provide a far better service. What's missing in the article, is the effect on the market size. Uber and Lyft changed the market size. I've taken probably a cab five times in my life before Uber existed, probably I'll use Uber five times before this week ends. And the same goes for many people. What about SpoonRocket, for example? Well, I ordered food delivery before it existed. Probably having an app and many more restaurants to order from increased my consumption of food delivery service, but just a 10 - 15% more. Not enough to sustain new players and make enough people switch fast enough to build a sustainable barrier to entry. Not sure I'm clear: Uber provided a service so much better that increased greatly increased the market size and captured a lot of new users (and old users were fast to switch). Other services failed to increase the market size and didn't provide existing users enough benefit to switching, so no barrier to entry for competitors, a lot of competition, a lot of startups that fails. I have a doubt, though. We are seeing a lot of Uber for X failing, but that's because a lot of them were competing for the same (in the US car-hailing market there was just Uber, Lyft, and Sidecar). That doesn't mean that one or two company will survive in the end.
- gcatalfamo 11y ago
  I definitely agree with you, but I didn't feel the point of the article is entirely on point, because of a very simple reason. You ordered food before Spoonrocket while Uber greatly improved an industry ripe for disruption: isn't that the point of startups anyway? While you are completely right, your point is not about "Uber for X" startups not working out, but ALL startups that are somewhat missing the right place in their markets...isn't it?
  - LukaAl 11y ago
    A little bit more complex, I guess I wasn't clear enough. But I agree with you.
kirykl 11y ago
Beating decentralized regulations seems harder. You have to wage the same war in lots of places. Although local regs could be easier to crack. Also if the service is good, it'll get a first opportunity somewhere

toomuchtodo 11y ago

Uber may still have to deal with the IRS extracting taxes and penalties for worker misclassification.

gcatalfamo 11y ago
Sure, but it's not a barrier for growth like what other "Uber for X" companies had to face...the moment that may come about dealing with the IRS Uber might be equipped more than enough to deal with it without too much problems...

J-dawg 11y ago

This is a very interesting and convincing theory. The same could be said for AirBnB. So the question is, what other locally-regulated industries are ripe for disruption?

jonny_eh 11y ago
Real estate sales
- J-dawg 11y ago
  I've discussed that very thing on HN before. Someone replied with "it's very hard to disrupt something that people don't do often". I think there's a lot of truth in this. Real estate sales seems to be pointlessly inefficient and overpriced, but it's something that people do a handful of times in their entire life, and they're willing to pay to have their hand held.
  - msellout 11y ago
    In fact, many people should pay more than they do -- get better lawyers, more thorough inspections, better negotiators, etc.

LukaAl 11y ago

Even if agree with you, centralized vs. decentralized makes a lot of difference, this is not the main point of the article. Centralized vs. decentralized influence your go-to-market strategy and probably your probability to succeed, but not directly your business model. The point made in the article is that the biz model of the "Uber for X" businesses is not very strong unless X is a heavily regulated market and you are able to skip part of the regulatory burden to provide a far better service. What's missing in the article, is the effect on the market size. Uber and Lyft changed the market size. I've taken probably a cab five times in my life before Uber existed, probably I'll use Uber five times before this week ends. And the same goes for many people. What about SpoonRocket, for example? Well, I ordered food delivery before it existed. Probably having an app and many more restaurants to order from increased my consumption of food delivery service, but just a 10 - 15% more. Not enough to sustain new players and make enough people switch fast enough to build a sustainable barrier to entry. Not sure I'm clear: Uber provided a service so much better that increased greatly increased the market size and captured a lot of new users (and old users were fast to switch). Other services failed to increase the market size and didn't provide existing users enough benefit to switching, so no barrier to entry for competitors, a lot of competition, a lot of startups that fails. I have a doubt, though. We are seeing a lot of Uber for X failing, but that's because a lot of them were competing for the same (in the US car-hailing market there was just Uber, Lyft, and Sidecar). That doesn't mean that one or two company will survive in the end.

gcatalfamo 11y ago
I definitely agree with you, but I didn't feel the point of the article is entirely on point, because of a very simple reason. You ordered food before Spoonrocket while Uber greatly improved an industry ripe for disruption: isn't that the point of startups anyway? While you are completely right, your point is not about "Uber for X" startups not working out, but ALL startups that are somewhat missing the right place in their markets...isn't it?
- LukaAl 11y ago
  A little bit more complex, I guess I wasn't clear enough. But I agree with you.

kirykl 11y ago

Beating decentralized regulations seems harder. You have to wage the same war in lots of places. Although local regs could be easier to crack. Also if the service is good, it'll get a first opportunity somewhere