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Given the numbers of this article, we should expect Uber to go bankrupt within the next two years or so. I'm fairly cynical and find it a reasonable prediction,

Given the numbers of this article, we should expect Uber to go bankrupt within the next two years or so. I'm fairly cynical and find it a reasonable prediction, but even if you don't agree with me, please play along. My question then is, when Uber goes bankrupt, what happens then? Would it spook the market? There are after all many other companies that have floated on investor capital. Would this sort of event be enough to cause a big market reckoning? Of course this is all the sort of speculation that's impossible to predict, but it's just something I've been thinking for a while. Uber failing would be a pretty big failure.

laurent92 5y ago
Grab is already leader in Asia, Uber is lacking in Indonesia. The difference? You have the choice between paying through the app or not (like a prepaid regular taxi). Uber designed its system to look as if drivers were employees, so they will die with the concept of HR fraud they created, but prepaid transport apps will remain.
- azth 5y ago
  In some countries, you can pay Uber with cash.
prepend 5y ago
I’ve wondered this because I’ve “just not understood how they can lose money.” I suppose during bankruptcy someone can buy their matchmaking tech and IP and relaunch without all that debt and overhead. Seems like a good target for someone to just run and pump cash out of as there should be a way to make money out of “market rate” * 15% fee for matchmaking. I mean taxis were profitable and this is just a better taxi algorithm since the automate the multiple drivers sharing a cab process.
- beckman466 5y ago
  > I suppose during bankruptcy someone can buy their matchmaking tech and IP and relaunch without all that debt and overhead. Seems like a good target for someone to just run and pump cash out of as there should be a way to make money out of “market rate” * 15% fee for matchmaking. I don't see that happening but do you have examples where that strategy has worked (in tech)?
  - prepend 5y ago
    Iridium networks [0] initially launched with lots of capital and kind of only made it after stuff was sold at bankruptcy prices. Although I don’t think they are phenomenally successful. I think there were a few dot coms that got bought out of bankruptcy by larger firms, maybe pets.com and toys.com (although toysrus is gone now). Polaroid [1] too although I think that’s more branding than technology. [0] https://en.wikipedia.org/wiki/Iridium_Communications https://en.wikipedia.org/wiki/Iridium_Communications [1]
- lallysingh 5y ago
  Matchmaking tech is likely cached A*. The rest is duplicated by mapbox and square.
- duped 5y ago
  The value is in their user base and driver portfolio. If they're worth anything, it's the contracts they have with drivers and cities to host an automated taxi dispatching service via mobile phones.
StriverGuy 5y ago
They will easily raise more money via debt or equity financing. There is no way they just collapse into bankruptcy. This article seems to dismiss how deep and liquid capital markets are today and easy it is to raise capital with even a sniff of cash flow..
- CogitoCogito 5y ago
  > They will easily raise more money via debt or equity financing. There is no way they just collapse into bankruptcy. > This article seems to dismiss how deep and liquid capital markets are today and easy it is to raise capital with even a sniff of cash flow.. I find it hard to share your optimisim in how easy it will be for them to raise more money. Regardless, my thought experiment was _if_ they go bankrupt, what happens then...
beckman466 5y ago
> My question then is, when Uber goes bankrupt, what happens then? Would it spook the market? Which is why Microsoft will buy Uber, to keep up the illusion that Uber is a valuable property.

laurent92 5y ago

Grab is already leader in Asia, Uber is lacking in Indonesia. The difference? You have the choice between paying through the app or not (like a prepaid regular taxi). Uber designed its system to look as if drivers were employees, so they will die with the concept of HR fraud they created, but prepaid transport apps will remain.

azth 5y ago
In some countries, you can pay Uber with cash.

prepend 5y ago

I’ve wondered this because I’ve “just not understood how they can lose money.” I suppose during bankruptcy someone can buy their matchmaking tech and IP and relaunch without all that debt and overhead. Seems like a good target for someone to just run and pump cash out of as there should be a way to make money out of “market rate” * 15% fee for matchmaking. I mean taxis were profitable and this is just a better taxi algorithm since the automate the multiple drivers sharing a cab process.

beckman466 5y ago
> I suppose during bankruptcy someone can buy their matchmaking tech and IP and relaunch without all that debt and overhead. Seems like a good target for someone to just run and pump cash out of as there should be a way to make money out of “market rate” * 15% fee for matchmaking. I don't see that happening but do you have examples where that strategy has worked (in tech)?
- prepend 5y ago
  Iridium networks [0] initially launched with lots of capital and kind of only made it after stuff was sold at bankruptcy prices. Although I don’t think they are phenomenally successful. I think there were a few dot coms that got bought out of bankruptcy by larger firms, maybe pets.com and toys.com (although toysrus is gone now). Polaroid [1] too although I think that’s more branding than technology. [0] https://en.wikipedia.org/wiki/Iridium_Communications https://en.wikipedia.org/wiki/Iridium_Communications [1]
lallysingh 5y ago
Matchmaking tech is likely cached A*. The rest is duplicated by mapbox and square.
duped 5y ago
The value is in their user base and driver portfolio. If they're worth anything, it's the contracts they have with drivers and cities to host an automated taxi dispatching service via mobile phones.

StriverGuy 5y ago

They will easily raise more money via debt or equity financing. There is no way they just collapse into bankruptcy. This article seems to dismiss how deep and liquid capital markets are today and easy it is to raise capital with even a sniff of cash flow..

CogitoCogito 5y ago
> They will easily raise more money via debt or equity financing. There is no way they just collapse into bankruptcy. > This article seems to dismiss how deep and liquid capital markets are today and easy it is to raise capital with even a sniff of cash flow.. I find it hard to share your optimisim in how easy it will be for them to raise more money. Regardless, my thought experiment was _if_ they go bankrupt, what happens then...

beckman466 5y ago

> My question then is, when Uber goes bankrupt, what happens then? Would it spook the market? Which is why Microsoft will buy Uber, to keep up the illusion that Uber is a valuable property.