22 ms·

Uber S-1

• Willson50 7y ago
  "We do the right thing. Period."
  • tzakrajs 7y ago
    Good thing there isn’t more than one perspective on what is right and wrong. This could’ve been a meaningless platitude otherwise.
    • simonrobb 7y ago
      There is value in vocalizing a guiding principle, even if it doesn't prescribe the exact way every single situation should be approached.
• CydeWeys 7y ago
  Wow, we're finally seeing all of these exact charts and figures that have been secret for so long. The easily digestible charts start on page 98.
• simonw 7y ago
  As always, the most interesting place to start is "Risks to our business": https://www.sec.gov/Archives/edgar/data/1543151/000119312519103850/d647752ds1.htm#toc647752_2 https://www.sec.gov/Archives/edgar/data/1543151/000119312519...
  • minimaxir 7y ago
    "Our business would be adversely affected if Drivers were classified as employees instead of independent contractors." They're upfront about it at the least.
    • simonw 7y ago
      Yeah the SEC force them to be brutally honest. "We have previously received a high degree of negative media coverage around the world, which has adversely affected our brand and reputation and fueled distrust of our company. In 2017, the #DeleteUber campaign prompted hundreds of thousands of consumers to stop using our platform within days. Subsequently, our reputation was further harmed when an employee published a blog post alleging, among other things, that we had a toxic culture and that certain sexual harassment and discriminatory practices occurred in our workplace. Shortly thereafter, we had a number of highly publicized events and allegations, including investigations related to a software tool allegedly designed to evade and deceive authorities, a high-profile lawsuit filed against us by Waymo, and our disclosure of a data security breach."
    • brownkonas 7y ago
      Just like the WWE’s designation of their employees as contractors. SDC could make the point moot , but this is a salient workers rights issue that politicians have not picked up on.
  • cheeze 7y ago
    "We have incurred significant losses since inception, including in the United States and other major markets. We expect our operating expenses to increase significantly in the foreseeable future, and we may not achieve profitability."
    • kornish 7y ago
      "We have incurred significant losses since inception and may never achieve profitability" is pretty standard in S-1s. Nothing particularly interesting in these sentences.
      • granzymes 7y ago
        This exact comment chain seemingly occurs in every S1 post.
        • iaabtpbtpnn 7y ago
          A long time ago, in a galaxy far far away, companies going public used to already make at least _some_ money...
          • granzymes 7y ago
            A more civilized age.
          • alphast0rm 7y ago
            Zoom is a profitable company that plans to IPO this year: "Zoom has the very rare and valuable financial profile -- it's growing at over 100% a year and it's profitable" [1], they're not extinct! [1] https://www.forbes.com/sites/petercohan/2019/04/11/zoom-has-mastered-the-art-of-profitable-growth https://www.forbes.com/sites/petercohan/2019/04/11/zoom-has-...
        • imjk 7y ago
          And with the S-1s coming at increasing frequency for the next several months, I expect this will be repeated many times
  • deleted 7y ago
    [deleted]
  • moflome 7y ago
    "We have incurred significant losses since inception, including in the United States and other major markets. We expect our operating expenses to increase significantly in the foreseeable future, and we may not achieve profitability." We have incurred significant losses since inception. We incurred operating losses of $4.0 billion and $3.0 billion in the years ended December 31, 2017 and 2018, and as of December 31, 2018, we had an accumulated deficit of $7.9 billion. Revenue: $11.2BB (2018) $7.9BB (2017) $3.8BB (2016) Growth: 3.3BB 4.1 NetInc: 1.0BB -4.0 -0.3 But net income buoyed by Other income (expense), net [0]: Other: $4.99BB (2018) -0.02BB (2017) $0.14BB (2016) What is that $4.99BB "Other" income? [0]: Includes gain on divestiture of $3,214BB, plus unrealized gain on investments of $1,996BB. (edit, format)
    • parthdesai 7y ago
      I think it's the investment round in which SoftBank invested around $3.5 billion.
      • acq_question 7y ago
        Dont mix up cash flow from financing activities with profit from sale of operational piece of the business ;). One is just a cash flow/balance sheet piece the other gets reflected in income ;)
  • pvilchez 7y ago
    I love starting there - this one is pages 25-72!
  • JMTQp8lwXL 7y ago
    One of the highlighted risks: > Maintaining and enhancing our brand and reputation is critical to our business prospects. We have previously received significant media coverage and negative publicity, particularly in 2017, regarding our brand and reputation, and failure to rehabilitate our brand and reputation will cause our business to suffer. In detail, they state: > Our brand and reputation might also be harmed by events outside of our control. For example, we faced negative press related to suicides of taxi drivers in New York City reportedly related to the impact of ridesharing on the taxi cab industry. Yikes, I never heard about that until reading it now. I could totally see how some people may have placed the bulk of their money into a NYC Taxi medallion, which have more than halved in value since 2015. https://qph.fs.quoracdn.net/main-qimg-a9d6f8a78e9c6e899cd886f38ab78fe1 https://qph.fs.quoracdn.net/main-qimg-a9d6f8a78e9c6e899cd886...
  • Agathos 7y ago
    Yeah, it's always a fun read for grumbling grognards like me. Pretty standard stuff, except I don't think I've seen a company call out its own culture as a risk factor before.
• chollida1 7y ago
  Note: - Expected to be teh largest IPO this year in the US. - 10th largest all time - trying to raise around $10B - 2018 Year Ended Revenue $11.27 billion - 2018 Year Ended Net Income $997 million - 2017 Year End lost $4.03 billion. - 10 billion trips in September 2018, up from 5 billion in September 2017 - Gross Bookings From Ridesharing $41.5 billion in 2018 - Revenue From Ridesharing Products $9.2 Billion in 2018 - List under UBER, good ticker!! - 29 banks listed as underwriting the IPO, for those of you wondering, yes that is alot. Like 20+ more than a typical IPO. From Bloomberg: - 2018, Uber's operating loss totaled $3.03 billion, however it technically turned a profit in 2018, generating $997 million in net income. That's thanks to a $5 billion "other income" benefit. Other Income is defined as: - Interest income, which consists primarily of interest earned on our cash and cash equivalents and restricted cash and cash equivalents. - Gain on divestitures, which consists of gain on sale of divested operations. - Unrealized gain on investments, which consists primarily of gains from fair value adjustments relating to our investments such as our investment in Didi. - Foreign currency exchange gains (losses), net, which consist primarily of remeasurement of transactions and monetary assets and liabilities denominated in currencies other than the functional currency at the end of the period. - Change in fair value of embedded derivatives, which consists primarily of gains and losses on embedded derivatives related to our Convertible Notes. - Other, which consists primarily of changes in the fair value of warrants and income from forfeitures of warrants. - Lyft now at $61/share, ouch, there just is no other way to put it. THey pulled a lot of financial engineering tricks to boost their IPO price and well the results speak for themselves:( Biggest Surprise to me: - Uber Eats comes in at $165 million for Q4, for comparison Ride sharing generated a total of $2.5B in net revenue, the rest being ride sharing. - So Uber is not really all that diversified in terms of ride sharing vs other, they are essentially Lyft in more markets.
  • zone411 7y ago
    This $3.2 billion other income in 2018 was from divestitures of Russia/CIS and Southeast Asia operations.
  • Not_a_pizza 7y ago
    So... Step one, raise funding to run a revolutionary company. Step two, ditch original idea for being revolutionary once funding is obtained. Use interest bearing bonds and other investments. Step three, profit.
• rb808 7y ago
  I wonder if someone connected to Uber has been trying to support the Lyft price. Given its still tanking it must be costing them loads.
• deleted 7y ago
  [deleted]
• whalesalad 7y ago
  > as of December 31, 2018, we had an accumulated deficit of $7.9 billion zoinks
• whoisjuan 7y ago
  Just a brief scan and it looks much healthier and diversified than Lyft. Of course far from a perfect business or anything. Their revenue is 5X Lyft's revenue. Doesn't look good for Lyft's stock to be honest. I wouldn't be surprised if after their first earnings release, Lyft stock goes below 40 USD.
  • throwaway5752 7y ago
    They did really well with the CEO they recruited. From the outside, it seemed like he did a really exceptional job profitably growing Expedia.
    • PMan74 7y ago
      > it seemed like he did a really exceptional job profitably growing Expedia. Expedia comes a distant second Booking Holdings. https://finance.yahoo.com/quotes/EXPE,BKNG/view/v1 https://finance.yahoo.com/quotes/EXPE,BKNG/view/v1 So while he may have done well, he didn't do as well as the competition.
    • prewett 7y ago
      When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact. --- Warren Buffett Expedia makes money from advertising (12%), from bookings fees, and from buying blocks of hotel rooms at a discount then selling them for higher prices to their customers (66%). [1] All of these revenue models are something that is pretty obvious how you make money at. And all of them are very different than crowd-sourcing rides for which it is not clear that the market prices is higher than the cost of providing the ride. [1] https://www.fool.com/investing/2017/08/28/how-expedia-makes-most-of-its-money.aspx https://www.fool.com/investing/2017/08/28/how-expedia-makes-...
      • Skunkleton 7y ago
        To further your second point. A whole cottage industry has sprung up around AirBnB. To me this indicates that the business model for AirBnB is working. There is no similar thing happening w/ uber. Seems to just be a question of who (uber or the drivers) is going to absorb the losses.
• partingshots 7y ago
  So... Let me see if I have this straight: 1. Uber is unprofitable and the only way it can become profitable is to get SDC's 2. Uber is significantly (years) behind Waymo in the SDC space. 3. Waymo will launch SDC taxi services first meaning: - When it puts in an order for SDC components no one else is going to be buying in bulk and thus it can have effectively 100% of capacity of these specialized equipment makers - It is going to be competing with other taxi/ride share services with all the cost advantages of SDC vehicles while its competitors are paying human drivers (and have basically no fat to cut from their current pricing) - It will be able to improve its services so when someone else does launch their service will be inferior. 4. Uber expects that its users will stick to it over the course of years in the face of significantly cheaper competition. 5. Uber expects that it is going to be able to continue to use human drivers even while it competes against those same people with its SDC's (i.e. when your employer hires your replacement but expects you to train them). I simply can't imagine how Uber is worth anything at the moment.
  • foobarbazetc 7y ago
    SDC’s are like... minimum 5 years away for something an early adopter would get into. So...
    • ModernMech 7y ago
      Been hearing that for almost 5 years now: From 2015: https://www.carscoops.com/2015/01/ford-ceo-says-driverless-cars-will-hit/ https://www.carscoops.com/2015/01/ford-ceo-says-driverless-c...
    • shereadsthenews 7y ago
      Waymo are driving early adopters around Phoenix right now.
    • suh_dude 7y ago
      No way are we going to be in autonomous vehicles that soon. All of the companies besides Waymo are just doing fancy lane assist and calling it self-driving. And Waymo only works in the most ideal conditions
• gigatexal 7y ago
  What’s there to see? What’s their value add? They’re not going to be profitable until driverless cars are a legit thing or they pivot into something with higher margins. This IPO will make incumbent banks a cool mint and early engineers paper millionaires but will hopefully blow up and let capital into companies that actually have a chance of staying solvent without successive massive influxes of cash.
  • inverse_pi 7y ago
    > and early engineers paper millionaires actual millionaires not paper millionaires :). > but will hopefully blow up why do you wish others to fail so bad?
    • saberience 7y ago
      No, paper millionaires. You're only an actual millionaire once you sell your stock. You become a paper millionaire when the IPO happens and you gain liquidity and price increases.
      • inverse_pi 7y ago
        Touche :)
      • esoterica 7y ago
        According to your logic there is no such thing as an actual millionaire. No sane person keeps a million dollars sitting in cash in a savings account, they invest it somewhere (equity, bonds, real estate, etc).
        • mrnobody_67 7y ago
          Lots of people keep 10-20% of assets in cash. if you have $20 or $30m, you'd almost certainly have $1m in cash sitting around.
          • 7y ago
• l2c1928 7y ago
  Convinced media-bias is the only reason why anyone could be "long $LYFT." They are a text-book "one trick pony" and too late for them to catch up in food delivery, international expansion, etc.
  • dtrailin 7y ago
    It's pretty reasonable to be skeptical of both companies considering how much money they lose without a clear path to profitability.
• jboy55 7y ago
  So 44% (4.4 billion) of their 2018 revenue was 'Other'. Gain on divestiture 3,214 Unrealized gain on investments 1,996 If this was pure cash going into their bank account, does it mean they ran out of cash in 2018? Their working capital was 4,900 billion at the end of 2018.
  • CydeWeys 7y ago
    Do we know what "other" revenue even is?
    • moflome 7y ago
      Includes gain on divestiture of $3,214BB, plus unrealized gain on investments of $1,996BB
      • MrStonedOne 7y ago
        Cool Whats that mean again?
        • jacques_chester 7y ago
          1. They sold some business or businesses. 2. They raised the book value of something else they own for some legal reason.
  • mckenna 7y ago
    They exited some markets and sold their business. "Other" refers to that, I think. So it's a one-time revenue.
• kapurs151 7y ago
  While I admit that the losses are staggering, the growth rates are also astounding: Revenue 2016: $3.8bn 2017: $7.9bn 2018: $11.27bn Trips 2016: 1.8bn 2017: 3.7bn 2018: 5.2bn The internet is such a game-changer.
  • scarface74 7y ago
    Uber does not have a proven business model until they can be profitable. Once they reach sustainable profitability, I’ll be impressed. We don’t know what the numbers look like until Uber either raises their prices or cuts their expenses to be viable long term.
  • moflome 7y ago
    > The internet is such a game-changer. Yes but also portable, low-cost GPS enabled internet connected devices are a game-changer. I don't see how Uber or Lyft could exist prior to the iPhone pushing adoption of GPS.
    • deleted 7y ago
      [deleted]
    • bagacrap 7y ago
      Did the iPhone so the most to push adoption? iPhone 1 didn't have GPS but the first Android device did. The killer app on mobile phones has always been Maps. I'd give Google the most credit here.
  • prewett 7y ago
    > The internet is such a game-changer. Or subsidizing artificially cheap rides is a game-changer.
  • naveen99 7y ago
    and only 2% of the population is using it monthly right now. I hope they gradually decrease the minimum age for riders. Children can finally regain some of the mobility they have lost in the modern world. Just reducing the age from 18 to 16, would probably double their monthly active users. They should atleast allow <18 year olds with drivers licenses to be riders...
• opendomain 7y ago
  Is the Saudi family invested in Uber? There was a story that Uber was trying to cover up that the Prince that ordered the murder of the journalist Khashoggi - is this true? I know this is a tech forum, but I am not sure what to believe?
  • nemothekid 7y ago
    The Saudi family is invested in a lot of SV companies via Softbank's Vision fund (The Saudi fund also owns 5.4% of Uber, directly). I don't think Uber, specifically, had anything to do with Khashoggi murders (with regards to the coverup).
    • joez 7y ago
      A Saudi Prince also invested in Lyft https://www.cnbc.com/2017/10/23/saudi-prince-alwaleed-bin-talal-invested-in-lyft-over-uber-heres-why.html https://www.cnbc.com/2017/10/23/saudi-prince-alwaleed-bin-ta...
    • benatkin 7y ago
      In addition to the SV companies there is WeWork, which is headquartered in New York. Also a bit surprising when I first heard about it.
  • shereadsthenews 7y ago
    The Arabs are all rolling in cash. It would be hard to find a large company they don’t partly own, just because of the sheer odds.
  • Jach 7y ago
    What experiences would you anticipate being different for you if you believed one way or another?
• throwaway743950 7y ago
  Would it be better to be hired 1 month before Uber's IPO or 1 month after and why?
  • richardwhiuk 7y ago
    One month before, because you get two extra pay checks. More relevantly, because of vesting cliffs it likely makes roughly no difference, except you get to see a bunch of colleagues celebrating becoming more wealthy.
• mckenna 7y ago
  Horrible numbers! They cannot get the unit economics to work. In order to make up for that fundamental flaw, they are trying to throw a number of things at the wall(UberEats/UberFrieght/SD/Bikes/etc) and see if something sticks. Each of those other bets seems poor, thus far. They better focus on getting their original business in shape(call a cab via an app). I would be curious to know if they tried to raise prices in any markets and what the results were. I'm sure they want to know this for themselves and their investors thus far. Has anyone seen data/insights into such experiments by Uber/Lyft/Ola/X/Y/Z? Given that none of the ride-sharing companies are sharing insights on such experiments, I am going to conservatively assume that these companies have low/no confidence that they can raise prices. Network effects make a good moat. But demand elasticity, substitute products, and competition seem to be dominating over the network effects. Their original business is a good one. Price and value are way out of sync. UBER at $100-120B is way overvalued. Not touching UBER/LYFT stocks with a long pole at these valuations. Overpriced by 3-4x in my view. When they fall by 70-80%, will buy some.
  • xiphias2 7y ago
    The real problem that I see with using Über in South America is that the service is not improving. - The time estimations are way off - The app doesn't know one-way roads well, although they should have a lot of training data on the routes I go on - They allow drivers haggling for the price by forcing users to pay with cash instead of credit card. - The app doesn't know about the road tarifs sometimes, and the driver is not allowed to ask that money from me, which makes an awkward situation - Sometimes I'm getting 30 year old cars, which the Taxi companies filter for I would happily pay more than the current price, but I need more reliable service, which the software could provide. Right now Taxis with all their problems are still competition.
    • SOLAR_FIELDS 7y ago
      I’m curious to know more about ridesharing in South America, specifically the haggle portion. If the credit card was allowed it seems like it would alleviate a decent amount of the issues you named in your post. Why would they disallow credit cards? Is it a cultural problem, infrastructure problem or something else? The other issues you mentioned seem to be tech related in that as companies that offer navigation services improve their data and services in South America the experience there should markedly improve.
• kgwgk 7y ago
  The trend in their Core Platform Contribution Margin ("a useful indicator of the economics of our Core Platform", essentially ignoring all the costs apart from payments to drivers and restaurants) is not very uplifting: Q1 Q2 Q3 Q4 2017 -8% -0% -3% 9% 2018 18% 15% 9% -3% "We also expect our Core Platform Contribution Margin to decline in the near term due to, among other factors, competition in Ridesharing and planned significant investments in Uber Eats, based upon our long-term growth expectations for Uber Eats. Our Uber Eats Take Rate has declined in recent periods, and may continue to decline, as we onboard large-volume restaurants at a lower service fee and restaurants with lower average basket sizes, and as we invest in more nascent and competitive markets, such as India."
• sixhobbits 7y ago
  > The Company has from time to time issued nonrecourse loans to certain employees for the exercise of stock options or for personal use. As of December 31, 2017 and 2018, the total outstanding employee loan balances were $21 million and $16 million, respectively. A total of 16 million and 10 million shares were pledged as collateral to secure the loans as of December 31, 2017 and 2018, respectively. Is loaning 20 million dollars to employees for personal use as dodgy as it sounds?
  • phonon 7y ago
    No, it's usually negotiated as part of an options package. "We will lend you the money to exercise your options". Then they can pay it back once they sell the shares they received.
• yalogin 7y ago
  Feels more like Uber and Lyft reached a point where they cannot raise private capital anymore and so jumped onto the public markets to fool random investors. If they cannot be profitable now, what makes them think they will be profitable with SDCs? I challenge the fundamental premise that SDCs will make them profitable. There is no stickiness to their business model. Moving on to another ride sharing service is frictionless today. Most people I know use both Lyft and Uber. So if tomorrow SDCs become popular and offer a cheaper rate, people will move to them in droves. Nothing stopping them. We know Uber and Lyft are way behind on SDCs compared to Google on that front. It also looks like GM and Ford could there before these two. So what makes them a good investment either in the short or long term?
  • deleted 7y ago
    [deleted]
  • dockd 7y ago
    Aren't most index funds, almost by definition, required to buy their shares? If Vanguard owns a piece of every listed company, they're going to buy Uber at pretty much any price, right?
    • mrhappyunhappy 7y ago
      I wonder about this too. What if I, as an index fund holder do not want the fund to buy up junk like lyft and uber?
      • MichaelDickens 7y ago
        The purpose of an index fund is to buy the entire market, under the assumption that an active fund will not outperform the market (after costs). If you want to avoid certain companies, you should buy an actively managed fund.
        • MrPowers 7y ago
          There are different types of index funds. There are market capitalization weighted index funds that fit your description of buying the entire market, but there are also small cap funds, sector funds, value funds, etc. You can avoid certain companies (e.g. FAANG stocks) by buying certain indexes (e.g. a value index).
• smb158 7y ago
  Looks like really bad news for LYFT. Their lack of diversification is really going to hurt them.
• dougmwne 7y ago
  I wonder if anyone reading through this filing could speculate: Can Uber just raise their prices to reach profitability? If they lost $3B on $44.1B of Gross Bookings, it seems they could raise their prices by about 7% to hit breakeven. Would they really lose that much market share if they did that?
  • danappelxx 7y ago
    If Uber raises prices, they immediately lose customers to Lyft. It was always a race to the bottom and I don’t see why it would be any different now.
    • dougmwne 7y ago
      Why wouldn't both Uber and Lift simultaneously raise their prices by a few percent? Once they're both public and the VC cash injections dry up they'll both need to raise prices if they don't want to be out of business. Coke and Pepsi don't sell at a loss to try to steal each other's market share. What would cause these two public companies to run themselves into the ground if the market could absorb a 7% price increase? I don't actually like Uber that much as a brand, and I understand that the HN groupthink is against them, but I'm not clear on why everyone seems think this is such a terrible business. Are people really going to go back to taking cabs? I predict that Uber and Lyft will both see big drops in stock price, especially as we enter the next recession. If one or both of the companies survive the downturn, they will turn into leaner, healthy bluechip stocks that turn a stable profit, at least until the flying, self-driving, solar-powered scooters take over. IMHO anyway.
      • raphaelj 7y ago
        Because that's market collusion, and that is illegal.
        • alaties 7y ago
          Collusion is when the parties coordinate on the price increases. If they both increase prices independently to achieve profitability, then I don't believe that to be illegal.
• subjectHarold 7y ago
  Rather than invest $10k in Uber, I went to the bank, got out $10k in singles, and burnt them in a garbage can in my back yard. ...this must be what disruption feels like. EDIT: Okay, I have an ulterior motive. I work for CashBurn, we are super disrupting the venture capital space. We use machine learning, AI, and the cloud(TM) to build a drone that will fly to your house, break in, hoover up your cash, and set fire to it. Super. By 2022, we are super optimistic that we will have aggressively disrupted the entire venture capital industry. No more wasteful spending on lawyers and investment managers...we cut out the middle man and burn your cash for you. We are currently raising a Series A.
• larkinrichards 7y ago
  I can't wait to see how a SDC deals with a passenger puking and passing out while getting a ride home from the club...
  • deleted 7y ago
    [deleted]
  • gboudrias 7y ago
    Have some dude oncall? You probably don't need more than one per city. Or do you not expect the car to detect puke and/or a passed-out passenger? Seems like a trivial problem compared to all the recognition software that would be needed for self-driving.
• justfor1comment 7y ago
  Some people are excited about Uber having a more diversified business than Lyft. Uber Freight, Uber Eats, Jump bikes and e scooters are some of their offerings. However, currently the revenue they generate (or don't) is completely dwarfed by the ride hailing service. If at some point in the future these other businesses turn out to be profitable, shareholders will insist to break them out of Uber to maximize gains. Ride hailing absolutely has to be profitable for Uber to succeed post IPO. At least for the foreseeable future Uber is exactly Lyft with minor garnishing.
  • gcb0 7y ago
    instead of one money-burning product, you get five burning your money! in two dozen regions! IPOs are making BTC look good.
• tom-_- 7y ago
  The cost of entry into this space is much greater than I think most people realize. It's not "building an app". It's building a balanced, efficient marketplace. This means complex matching, pricing and routing algorithms that have been developed for almost a decade. It's also about working with regulations at the city level and building a reliable labor force of contractors to supply the marketplace in every new city before the launch date. There is so many experiments and tweaks to ensure that both supply and demand side remain properly incentivized, not to mentioned fighting deeply entrenched Taxi companies from city to city, that I'm surprised Uber and Lyft have gone to IPO so quickly, other than for cash raising.
  • hn_throwaway_99 7y ago
    I disagree. http://www.rideaustin.com/ http://www.rideaustin.com/ was launched in Austin a couple years ago when Uber and Lyft were temporarily kicked out of the city. The app had some growing pains but now I use them whenever I can in preference to Uber and Lyft because they pay their drivers more. If Uber and Lyft suddenly went away Ride<CityName> could easily pop up all over. Of course, Uber and Lyft right now ARE so big because of all the advantages you mention, but a lot of that is still due to boatloads of VC money that allow them to operate unprofitably.
    • largehotcoffee 7y ago
      A service that exists in one city, (and can't even keep their appstore rating above 4 stars in that city) is not a good comparison.
      • janfoeh 7y ago
        Yes, they are. I don't care whether a ride service is available in one, a dozen or three hundred locations. I care about the best option in my city, and I would bet dollars to donuts that this aligns with the market majority. A thousand local or regional competitors are just as much an existential threat to Uber as one or two big ones.
• z3t4 7y ago
  Uber is basically an escrow for illegal taxi operations. They're hustling.
• rgawdzik 7y ago
  Any idea on the size of the employee option pool given 22.3% is owned by "other shareholders", with 22,263 employees and 3000+ engineers?
• goldcd 7y ago
  I'm not an Uber-hater - but they don't offer anything unique and the valuation is insane. Their problem is that if they rack up prices/commission to pay off their investors, then both their drivers and riders will simply switch to the next pre-IPO company that will connect them for less. Uber in my mind is like all the other social media sites. We appreciate that they're the best thing to connect us at this time - but if something better comes along, both sides have no loyalty and will move on. Can anybody imagine an Uber provider/rider they've met paying over the odds for an identical service because "they love the Uber brand"?
  • noway421 7y ago
    I can imagine such a person. If rider values reliability, they would always open Uber app straight away and get a ride in 5 seconds. I don't think the argument of people switching to a cheaper service actually holds true that much. People don't shop around for a ridesharing service, they open up something that they know will work and work fast.
• sytelus 7y ago
  As an IPO n00b, I have basic question: Let's say I'm a startup founder with revenues in $10M and want to raise money. Can't I just go straight to IPO instead of making VC rounds? It seems you don't need to be profitable or even have to have great outlook. Meanwhile majority of IPOs are getting magically funded anyway no matter what. On the top of it you get to even keep most of the voting shares. So what are the minimum requirements to do IPO?
  • YjSe2GMQ 7y ago
    I don't know the answers to your specific questions, but note that such late and humongous IPOs are a recent phenomena: https://steveblank.com/2019/04/10/startup-stock-options-why-a-good-deal-has-gone-bad/ https://steveblank.com/2019/04/10/startup-stock-options-why-... My guess is that $10M/yr in revenue is close to enough to IPO. It's just not popular recently.
    • umeshunni 7y ago
      Some reasons why a company with $10M/year in revenue may not want to IPO: 1. Due to recent regulations (introduced after the 2000 dot-com crash), the fixed cost of going IPO (SOX compliance, putting internal controls in place, audits etc) have significantly gone up. 2. The additional scrutiny and public visibility that comes from going public is a drag on management bandwidth, employee morale and attention. 3. Private money is now plentiful and cheap, so it might actually be cheaper just to take private investors than public. 4. Public markets prefer stable, predictable companies with a known well understood strategy. Consider how often Tesla is in the public eye and how they might have benefited from staying private longer given their unpredictable business and strategy.
  • polishTar 7y ago
    There are tons of restrictions on public companies that don't apply to companies that are still private. Too many to list, but these include disclosure requirements (10-K, 10Q, 8-K...), restrictions on who can be on the board, regular independent financial audits, SOX compliance scope, CEO+CFO certifications, shareholder proposal requirements, listing requirements+fees, etc. The restrictions are enough of a pain (especially the disclosure requirements since most companies would prefer their competitors not knowing their financial state) that it isn't uncommon to see a private company put off an IPO for a super long time.
• deleted 7y ago
  [deleted]
• smolsky 7y ago
  So, here a line from their "Consolidated Statements of Operations": Other income (expense), net: 139, (16), 4,993 The three numbers representing 2016, 2017 and 2018. The company is _only_ $997M down for 2018 because of that $4,993M item. Can someone explain what that is? Will it re-occur in the coming years?
• bcaulfield 7y ago
  So it begins.
• graaben 7y ago
  "We generated 15% of our Ridesharing Gross Bookings from trips that either started or were completed at an airport" This just highlights the need for better public transportation from cities to their airports.
  • jmccaf 7y ago
    Especially arriving, and also departing, I think Uber with "door-to-door" service may be a better answer. Luggage above carry-on would be hard to take on multiple-stop public transportation with a walk, and especially arriving in evening after a tiring travel, I often want to get directly to my lodging and freshen up.
    • yellow_postit 7y ago
      As a counterpoint see Heathrow Express in London. Taking taxis in London from a major airport, unless at odd hours, is almost always more expensive and slower even with checked bags.
• puzzle 7y ago
  Juicy details about Levandowski and their Google Maps costs...
• deleted 7y ago
  [deleted]
• an4rchy 7y ago
  Interesting S-1. I was actually kinda bearish on Uber in terms of scale for future growth/profit opportunities, compared to Lyft, but now I feel like Uber has the upper hand. Yes, profitability is a big piece, but Uber is more diversified, in that they have other rev streams - Food Delivery and Freight, which they are ramping up (Focused on growth for now). Also, by way of partnerships/equity, they have stakes in a lot of different market leaders in other markets/geographies. These companies are further diversified in terms of other rev streams (payments, commerce, food delivery etc). Not sure how much of that is captured in the valuation. SDCs (L5) are definitely a ways off in terms of becoming ubiquitous. Companies are doing fixed route or city/geo-fenced testing and for any of these companies to actually get to Uber's scale will take a long time and maybe Uber can acquire/partner with one/more of these before that happens. Also, if we consider ride sharing as a commodity, Uber benefits from economies of scale as opposed to other competitors who may operate in smaller regions/markets so that's also going in their favor. All of this is to say, they are definitely focusing on growth for now (which there is a lot of opportunity for), but at a certain point they could probably start becoming profitable by either reducing costs or ramping up prices (in tiny percentages) and still be better than the alternative.
• lancewiggs 7y ago
  Their falling growth is the biggest concern for investors. 2016-7: 100% revenue growth, 105% trips, 51% MAPC 2017-8: 40% revenue growth, 40% trips, 33% MAPC (MAPC = active users) These are sharp drops in the growth rate. The quarterly revenue data is more worrying - December Quarter 2018 was up only 22% over the previous year. (Page 121) On Page 126 we see that even that revenue increase was subsidised by excess driver incentives, and netting that out the growth was only 17% year on year. They have tightened things and their adjusted yearly EBITDA loss fell by $800m to $1.65 billion, but has this come at the expense of growth? Or has the growth simply become too expensive to chase? Or are electric mobility devices taking away the shorter distance rides? And they had a loss of $890 million in the last quarter, and it's hard to see tangible evidence of margin improvement. (P128) A valuation today of, say, $100 million needs to have net income of, say, $10 billion to be a very real probability relatively soon, or of one much larger later. At, say, a 20% net margin and 40% growth $10 billion income would take 5 years. But that is a courageous assumption about the growth rate, given the above, and it also assumes significant margin improvement, which will be hard if the marketing spend continues, which itself is required for growth. And pricing is hard because increased prices simply move customers onto other platforms. This is not a winner take all market. For the model to work Uber Eats growth needs to be maintained for a while, and that's possibility, although I suspect their margins will be sharply squeezed as big brand chains respond. (e.g with Mobi2Go and 3rd party delivery agencies they can roll their own)
• alphagrep12345 7y ago
  My observations 1. Humans aren't gonna trust SDCs easily. The way I look at it, SDCs would be used only to transport freight for a few years before people can trust it enough for ride sharing. I personally believe that companies should focus on self-driving trucking rather than self-driving cars and pivot into ride sharing after a few years of successful freight transport. People would trust the leader in the self-driving truck industry more than a top-notch but unproven tech company. Let alone cars, as simple as elevators in the buildings were operated by actual people before becoming completely autonomous. 2. Uber is not just in the USA. SDCs aren't gonna be approved everywhere, even after it becomes legal in the USA. Uber still has access to that market, but Waymo magically can't. 3. Uber has other verticals too (Uber Eats).
  • haditab 7y ago
    > I personally believe that companies should focus on self-driving trucking rather than self-driving cars and pivot into ride sharing after a few years of successful freight transport. Really? I work in the SDC industry and I have the opposite opinion. Unless the self-driving trucks are all driving on dedicated roads (which won't happen) I would not want to share the road with them while they 'experiment'. IMO, the greatest threat is not to the occupants of the SDC but to the other vehicles, pedestrians, and bicyclists.
• carter2012 7y ago
  Hate them deactivate me for no reason customer stated I use profanity really?
• carter2012 7y ago
  Hate then deactivated me because customer stated I used profanity REALLY?
• Centaur1989 7y ago
  People here seem to think that Uber/Lyft do not have any competitive moat. I disagree. What we seem to forget is that just because a VC can burn boatloads of money to capture ridesharing market from Uber/Lyft doesn't mean that they would. From a game theoretic POV, Uber and Lyft have signaled that they're ready to fight for survival in markets they are established in. Unless as a startup founder you can demonstrate that you can achieve lower cost structures than Uber/Lyft, no VC will fund their rapid growth (small offerings will still find a niche, assuming they don't get gobbled up). Uber/Lyft do have a VCs-will-not-race-to-the-bottom-with-them moat, and tomorrow they might as well raise their prices to turn profitable. Their biggest challenge is Waymo and SDC because if a competitor as significantly lower cost structure, all bets are off.
  • tsycho 7y ago
    What's SDC? I got nothing obvious from googling it. UPDATE: Got it, self driving cars. I am not deleting the comment in case others were confused as well.
    • omot 7y ago
      Self driving cars
    • jiveturkey 7y ago
      use contextual clues ... Self Driving Car
      • sabertoothed 7y ago
        SDC could have been a company since it was mentioned next to Waymo. I stumbled as well for a few seconds.
      • rootusrootus 7y ago
        SDC as an acronym for self driving car seems to have become a 'thing' on HN very recently, I never noticed it until just the recent past. It's not unreasonable for someone to be ignorant of it.
• bronz 7y ago
  people in here keep on saying that uber is not making profit. where is the source for that? i remember people saying the same thing about tesla. complete dogma. nobody seemed to understand that tesla was investing huge amounts of money into the development of other cars and expanding their factories. so what are ubers expenses? it does not pass the smell test. what is the expense that is killing them? and people in here also dont seem to appreciate that uber can change their prices. they cant right now, but they will be able to soon. all the investor money floating around means that their competition may be able to operate in the red for extended periods of time. when the investor money dries up and everyone is surviving on profit, prices can go up. and they will go up because rideshare is the most efficient and cheapest way to do taxis -- nobody is going to come in and disrupt uber. except for driverless cars. but driverless cars arent going to happen. not anytime soon. edit: i just looked at the chart in the document and as far as i can tell they are 3B in the red. not really sure what the units are in that chart. ok, well there are a lot of expenses where i cant tell exactly what they are, but their marketing expenses were 3B. 3 fucking billion dollars -- am i reading that correctl? thats the same amount by which they are in the red. i also see some very high numbers for management. all uber has to do is cut the fat and they will be making a nice profit.
• bogomipz 7y ago
  Does anyone know how soon after an S-1 filing a company can issue their IPO? Is it basically up to them once they've filed or is there some vetting period at the SEC? Will they be doing a road show next or is this something that they would have already done prior to the filing?
• trpc 7y ago
  looks like every unicorn is racing to go public before the recession
• thisisit 7y ago
  One of the most interesting things I see about Uber/Lyft's IPO has been their risk factors which says: Our business would be adversely affected if Drivers were classified as employees instead of independent contractors.
• jbhatab 7y ago
  Can we just take a second to appreciate how ridiculous their growth chart is considering how big they are. Hockey stick at its finest.
  • smolsky 7y ago
    I think the word you are looking for is "quadratic".
• falaki 7y ago
  Uber is clearly losing share to Lyft: "In 2017, our ridesharing category position in the United States and Canada was significantly impacted by adverse publicity events. Although the rate of decline in our ridesharing category position has since moderated, our ridesharing category position generally declined in 2018 in the substantial majority of the regions in which we operate, impacted in part by heavy subsidies and discounts by our competitors in various markets that we felt compelled to match or exceed in order to remain competitive."
• nimbius 7y ago
  if i were rich enough to invest, Uber would be an absolute landmine for me. This company seems to be run like a mafia ring compared to lyft. https://en.wikipedia.org/wiki/Uber#Criticism https://en.wikipedia.org/wiki/Uber#Criticism
• datdata 7y ago
  Wow those are some heavy risk disclosures: We have incurred significant losses since inception, including in the United States and other major markets. We expect our operating expenses to increase significantly in the foreseeable future, and we may not achieve profitability. Our business would be adversely affected if Drivers were classified as employees instead of independent contractors. If we are unable to attract or maintain a critical mass of Drivers, consumers, restaurants, shippers, and carriers, whether as a result of competition or other factors, our platform will become less appealing to platform users. We may fail to develop and successfully commercialize autonomous vehicle technologies and expect that our competitors will develop such technologies before us, and such technologies may fail to perform as expected, or may be inferior to those developed by our competitors.
  • kevstev 7y ago
    eh, those are more CYA than anything. Yes, these are risks, but thats in plain sight. Its about disclosing all the ways you could fail, however obvious, to avoid a lawsuit. There are lots of scary statements like that in most financials.
    • rossdavidh 7y ago
      Yes, but...they are all not even all that unlikely, in this case. This looks to me like "IPO now because this is as good as it will ever get".
• baq 7y ago
  that's it, we're officially close to a recession
• Alliva 7y ago
  Wow, some heavy risk disclosures.