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Biggest expenses are keeping driver supply high in new cities until the service adoption gets traction among consumers, and customer support / fraud mitigation
by lhorie 8y ago
Biggest expenses are keeping driver supply high in new cities until the service adoption gets traction among consumers, and customer support / fraud mitigation (again, primarily in new cities).
For the most part, established cities are profitable (at least for Uber, I don't know the story for Lyft).
- pochamago 8y agoThat makes sense, but it makes me skeptical, then, of the article's claim that they have no path to profitability.
- Sohcahtoa82 8y agoMany investors are extremely short-sighted.
- lhorie 8y agoThe better analyses I've seen say that Lyft could be profitable, if they stopped subsidizing growth via their profit centers, but then they have to somehow overcome the one-trick pony problem and it's not very clear how. Uber, on the other hand, has several verticals, and also enough muscle to be able to strike profitable deals w/ local competitors, as it has already done in various countries.