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As Ben Thompson of Stratechery explains, Uber is a two-sided market- it has sufficient liquidity of both riders & drivers. Any new app would have to sign up ten
by hash872 5y ago
As Ben Thompson of Stratechery explains, Uber is a two-sided market- it has sufficient liquidity of both riders & drivers. Any new app would have to sign up tens of thousands of drivers to be even remotely competitive, and that would cost tens of millions of dollars in promos, marketing, etc. The first time someone tries UberClone and the driver is 30 minutes away, they'll close the app and never use it again. No VC is interested in financing all that for a very low margin business. Uber and Lyft have all the drivers and have all the riders- being unprofitable is actually a moat
- asdff 5y agoYou already have taxi companies with drivers. Yellowcab actually makes their own app.
- vineyardmike 5y ago> Yellowcab actually makes their own app. I would never use this since i have the uber app first.
- ChefboyOG 5y agoI don't know if that's actually a moat. It's fairly common in my experience to have Uber and Lyft downloaded, for example, to compare rates, particularly when surge pricing comes into play.
- webmaven 5y ago> being unprofitable is actually a moat That only works as a business if the moat is a loss-leader for some other product or service.