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Yes, they can cut their burn rate. But if they cut it too much, they'll stop growing. The problem is they need to sustain their 70 billion dollar valuation fo
by OriginalPenguin 9y ago
Yes, they can cut their burn rate.
But if they cut it too much, they'll stop growing.
The problem is they need to sustain their 70 billion dollar valuation for investors to be happy.
To be worth 70 billion they have to be either:
Growing at a very fast rate (which requires a very large burn rate to sustain)
Or be generating billions in profit each year. Even with a cut burn rate, they aren't going to be generating billions in profit. So they won't be worth $70 billion.
- fragmede 9y agoKeep in mind that if their leaked financials are to be believed, they made $6.5 billion in net revenue for 2016. Unfortunately total costs exceed revenue, so they are far from profitable, but that's not exactly chump change.
- namdnay 9y agoWhat are they counting in net revenue? As they bill themselves as a brokerage service (to avoid those pesky employment laws...), I would imagine they only count their commission in net revenue? 6.5 billion is pretty impressive then!
- georgespencer 9y agoThey included all of the revenue (i.e. gross revenue) from Uber Pool in that figure.