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How does Über, Deliveroo, etc work? They pretend spending in marketing but actually subsidizes market acquisition with VC money (for instance Deliveroo pays the

by wazoox 9y ago

How does Über, Deliveroo, etc work? They pretend spending in marketing but actually subsidizes market acquisition with VC money (for instance Deliveroo pays the delivery guy at least 7.5€, but charges the customer 2.5€: it just doesn't add up), with the assumption that they can form an actual monopoly and eventually reimburse investors by ripping off workers and customers in the mid term. The only upside I see is that they actually spend money from quantitative easing and market bubbles in the real economy. They're a symptom of a sick financial system and a sick economy. This business model doesn't belong to companies, but free association of workers. They all (Über included) should be closed down, the sooner the better.

hobofan 9y ago
I am not a big fan of Deliveroo, Foodera, etc. either, but from what I've seen reported they are not too bad when it comes to treating their drivers (at least here in Berlin). The restaurants/kitchens also seem to profit from it and a lot of new places opened up specifically with those services in mind. AFAIK your calculation also isn't true. Deliveroo pays it drivers 7.5€/__hour__ + 1€/delivery (or something like that), so as long as they do enough deliveries/hour, that should work out. I'm still more concerned about the absurd marketing battle, but in my personal perception it slowed down quite a lot the last months in Berlin.
- wazoox 9y ago
  In Paris they just dropped the hourly wage. No delivery, no money. Once they're ahead of competition, they screw their "partners".
  - kantspel 9y ago
    wow that's appalling.
kantspel 9y ago
to add to this, in Australia they bypass our award wages for couriers by making their workers self-employed. really, the only innovation they are doing is the exploitation of labour laws.
- deleted 9y ago
  [deleted]
CamelCaseName 9y ago
It does add up because Deliveroo gets more than just the delivery fee, they charge a commission on the sale. The following passage explains it better: "The components of Deliveroo’s revenue come from users in the form of delivery fees at £2.50 and commission fees from restaurants. The commission they charge is generally 10% of the order, with the average order being around £30. Therefore a typical order will generate around £5.50 and within an hour Deliveroo can typically generate around £16.50 per driver." Source: https://thebusinessoftech.wordpress.com/2016/05/08/deliveroo/ https://thebusinessoftech.wordpress.com/2016/05/08/deliveroo... My startup was in this space (Not the UK though) -- if you have any questions feel free to drop me a line

by wazoox 9y ago

hobofan 9y ago

I am not a big fan of Deliveroo, Foodera, etc. either, but from what I've seen reported they are not too bad when it comes to treating their drivers (at least here in Berlin). The restaurants/kitchens also seem to profit from it and a lot of new places opened up specifically with those services in mind. AFAIK your calculation also isn't true. Deliveroo pays it drivers 7.5€/__hour__ + 1€/delivery (or something like that), so as long as they do enough deliveries/hour, that should work out. I'm still more concerned about the absurd marketing battle, but in my personal perception it slowed down quite a lot the last months in Berlin.

wazoox 9y ago
In Paris they just dropped the hourly wage. No delivery, no money. Once they're ahead of competition, they screw their "partners".
- kantspel 9y ago
  wow that's appalling.

kantspel 9y ago

to add to this, in Australia they bypass our award wages for couriers by making their workers self-employed. really, the only innovation they are doing is the exploitation of labour laws.

deleted 9y ago
[deleted]

CamelCaseName 9y ago

It does add up because Deliveroo gets more than just the delivery fee, they charge a commission on the sale. The following passage explains it better: "The components of Deliveroo’s revenue come from users in the form of delivery fees at £2.50 and commission fees from restaurants. The commission they charge is generally 10% of the order, with the average order being around £30. Therefore a typical order will generate around £5.50 and within an hour Deliveroo can typically generate around £16.50 per driver." Source: https://thebusinessoftech.wordpress.com/2016/05/08/deliveroo/ https://thebusinessoftech.wordpress.com/2016/05/08/deliveroo... My startup was in this space (Not the UK though) -- if you have any questions feel free to drop me a line