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Uber and Lyft are the best examples of the VC cycle: Disruptor comes along to stagnant industry. Pumps cash into growth, discounts get many people on board, cr

Uber and Lyft are the best examples of the VC cycle: Disruptor comes along to stagnant industry. Pumps cash into growth, discounts get many people on board, crap service is made up for with liberal refunding by customer service. Push for profitability hits discounts, acquisition slows because it's no longer cheaper than the thing it was disrupting before, customer service stop refunding things and customers leave because they realise the service has pretty bad flaws. Incumbents have finally met the new table-stakes features to compete, disruptor isn't significantly better. See also: takeaway deliveries, meal kits, buying books online, and pretty much anything else. These cycles always look like they're going to be a 100% improvement, but always end up being a 10% improvement once everything settles down.

diegoperini 5y ago
I agree. I also like 10% improvements.
- danpalmer 5y ago
  So do I! I'm not sure they justify multi-billion-dollar valuations though.
  - amelius 5y ago
    Yeah, someone wrote a CRUD app to do ride sharing and now somehow their worth is in the same ballpark as a semiconductor superpower.
  - freewilly1040 5y ago
    A 10% improvement over an incumbent means a complete takeover of the industry.
    - mantas 5y ago
      Assuming that incumbent does not improve...
    - danpalmer 5y ago
      These percentages are all subjective, I'm just trying to illustrate a point. I don't think it does mean a complete takeover. There are plenty of industries where being 10% cheaper doesn't mean you "win", and there are plenty where being 10% better doesn't either. In a world of perfect competition and perfect information it might, but it's well accepted that we do not live in that world.
      - freewilly1040 5y ago
        It's an odd argument to make in the context of Uber/Lyft, which have indeed "won" by any reasonable definition, and handsomely rewarded it's investors (which should be victims in the overhype / under deliver scenario).
  - Bombthecat 5y ago
    10 percent improvement from a local small taxi company vs a worldwide company? It does make sense..
  - marcosdumay 5y ago
    You mean you don't like a bunch of rich people throwing money away so you get a 10% improvement on some service? I only have a problem with them trying to make it out on the IPO instead of making a profitable business. But this one can not go forever, or the public will wake-up, or the law enforcement will.
davidweatherall 5y ago
How can you say Uber is a crap service? Compared to the predecessor of hailing a taxi, the consumer experience of hiring an Uber far exceeds it.
- _ea1k 5y ago
  Uber is basically the McDonald's of hired transportation. There are limitations, the experience definitely isn't premium, but its ultimately a fairly consistent purchasing experience that works most of the time. Regular taxis? Sure, download this city specific app. Or one of the two city specific apps. Or call one of the local cab companies and find out you picked the one that doesn't consistently dispatch to your hotel so you end up waiting around with zero feedback. Or maybe you call and they show up in five minutes and its great.
- danpalmer 5y ago
  For taxis, depends where you are and what other taxis you were booking. Compared to a London Black Cab, much better, compared to a licenced minicab, about the same but via an app instead of a phone call. For Uber Eats though, I've had them claim that there is no expectation of food arriving hot. First few times I had delivery problems I got full refunds and the reputation was always "give it a go, worst case you can get a refund anyway". Now it's hard to even get in touch with support let alone get them to acknowledge an order issue, and refunds are almost unheard of. Edit: I had forgotten about all the issues with sexual assaults by Uber drivers. They tried to downplay the issues, but ended up having to implement a lot of controls to understand who was driving the cars, in some markets they now have to be licenced, it's all changed a lot since the beginning because of how the service was actively dangerous compared to incumbents who were typically much more tightly regulated.
  - leoedin 5y ago
    The Uber experience is (or at least used to be before covid) way, way better than London minicabs used to be. Minicabs had no accountability and small fleet sizes - so at peak times they'd either turn up really late or not turn up at all, with no recourse. I think they've forced everyone to change now - if they disappeared tomorrow another operator would fill the void. But when Uber first started operating it was a radically improved service.
lhorie 5y ago
> crap service is made up for with liberal refunding Uber has crap service? I was under the impression the whole point of Uber becoming so ubiquitous as to become a verb was that you could actually get service at all in a timely fashion whereas cabs had a terrible reputation. IMHO, if you're only looking at rides, you've got your consumer hat on and I think you're missing the big picture. Uber is still not done trying to eat the world so to speak. The food delivery vertical is one of its most well known growth markets, but it also has eyes on the actual hailable taxi market[0], buses/high capacity vehicles[1], deliveries/logistics market (uber direct[2], uber freight[3]), it's building up loyalty program strategies a la costco/amazon prime/visa (uber pass[4]), etc. Basically, anything that remotely involves wheels is game for Uber. This thirst is what I think characterizes unicorns: Google started as a one trick pony with search, and now has maps, docs, android, GCP, Waymo and a million other things. Amazon was a just a book store and now it's basically synonymous with online shopping and cloud infrastructure services. [0] https://www.themuse.com/jobs/uber/hailables-lead https://www.themuse.com/jobs/uber/hailables-lead [1] https://www.uber.com/en-EG/blog/introducing-uber-bus-a-new-way-to-commute/ https://www.uber.com/en-EG/blog/introducing-uber-bus-a-new-w... [2] https://www.uber.com/newsroom/moving-more-of-what-matters-with-delivery/ https://www.uber.com/newsroom/moving-more-of-what-matters-wi... [3] https://www.uber.com/us/en/freight/ https://www.uber.com/us/en/freight/ [4] https://www.uber.com/us/en/ride/how-it-works/uber-pass/ https://www.uber.com/us/en/ride/how-it-works/uber-pass/
- gonehome 5y ago
  Agreed - Uber is amazing and I’m glad they pushed through all of the regulatory bullshit to defeat cabs. I can call a car from almost anywhere in the world and have a ride in a few minutes for a reasonable price - that’s a huge shift.
  - kbsspl 5y ago
    >Uber is amazing and I’m glad they pushed through all of the regulatory bullshit to defeat cabs. Remember, effectively you have said law breaking is acceptable. In this case, it may be partly even true, but once this catches on, anarchy, literally one step away.
tfehring 5y ago
Buying books online is a counterexample if anything. Books are a great product to sell online because they're relatively compact, there are a ton of them (way too many to have them all in a single physical bookstore), and two copies of the same new book are generally undifferentiated (unlike, say, produce). At least based on the way Bezos and other early insiders talk about it decades later, Amazon was never intended to be just a bookstore, but they were pretty intentional about starting with books.
alphadelphi 5y ago
It looks like a reference to the hype cycle https://en.wikipedia.org/wiki/Gartner_hype_cycle https://en.wikipedia.org/wiki/Gartner_hype_cycle
amelius 5y ago
You forgot to mention peak-hype, when the original investors sell their shares and laugh their way to the bank, while the subsequent buyers are left with a company of questionable value. This is what keeps these cycles going.
manigandham 5y ago
It's more than a 100% improvement for me. I've taken thousands of rides, safely and easily, using a single app across countries and currencies without any major issue. It's also opened up travel in big cities and foreign regions that I wouldn't otherwise be able to do at all. There's no alternative to this and it's incredibly valuable to many, even if you don't use it.
mint2 5y ago
Amazon just sent us an actual paper catalog in the mail for clothing and gifts. Web shopping killed catalogs and now the biggest online store is sending me catalogs. I think it’s an admission their site is an un-curated mess. but come on, are paper catalogs really the best solution Amazon came up with for their online store being cluttered, useless for product discovery, and overrun by poor quality products and fakes?
- ljf 5y ago
  I sometimes feel like it is only me that suffers this - finding anything of quality on amazon is a pain. Unless I know the exact model number, chances are I'll be sold low quality stuff. I want some wine glasses, picture looks OK, reviews seem good - turn up - junk. I want to find a monitor - good luck! I want to find some light bulbs... Erm yeah, same. Time was it was good as you knew it was cheaper than most places but that is generally totally not true now.
jaredklewis 5y ago
> crap service Sorry, but Uber is a 100% improvement service improvement over cabs in many areas. I lived in Chicago for six years and not one single cab I took during the whole six years would accept a credit card, despite being obligated to do so. If I didn't have cash I was told that we could drive to an ATM or I could get out. Not to mention that the drivers almost invariably talked on the phone the entire time. And while not the norm, I had half a dozen confrontations with cab drivers who were obviously trying to scam me with "broken meters" or obviously roundabout routes. I haven't had a single bad experience with an uber or lyft. Most are unremarkable, which is fine. So 100% of my cab experiences in Chicago were bad and 100% of my uber/lfyt experiences have been fine or better. Of course not everywhere is Chicago (though US cab companies generally seem to have miserable service). Tokyo taxis have world class service, and it is perhaps not a coincidence that Uber has only a tiny presence there.
- lhorie 5y ago
  > Tokyo taxis have world class service, and it is perhaps not a coincidence that Uber has only a tiny presence there Funny you mention this. I actually had a bad taxi experience in Japan of all places: asked the hotel to call for one multiple times, 40 minutes later it never showed up, so I requested an Uber, and got a car in 5 minutes (this was in Kyoto, though, not Tokyo)
- thehappypm 5y ago
  Can't agree more. Lately I've been taking taxis from the airport, since it's usually more convenient to just wait in line at the taxi stand than to play roulette with the apps. And oftentimes cheaper. But the last time I took a taxi the damn card reader didn't work and the driver made me feel like a criminal, and I had to download some app to pay via Apple Pay.
  - spookthesunset 5y ago
    Their card reader probably worked fine. My theory is the cab driver prefers to use their own payment methods because they are “off the record” and they probably turn into cash in the drivers pocket much faster than using the one provided by the cab service.
achenatx 5y ago
flew into jfk last week. Got in a taxi, driver didnt want to turn the meter on. Tried to tell me it was $80 instead of the $52 fixed rate + tolls etc. I managed to pay $65, but I had to pay in cash. the same thing happened on the way back, except my hotel called the taxi, so then the taxi driver gave the bellman $10 and wanted me to give him the $10 he had to pay the bellman (which I did). He also wanted cash and didnt turn the meter on. I worry that if I insist they turn the meter on they would stop and kick me out of the taxi. And yes Im out of practice. I used to negotiate that we use the meter and I can pay with a credit card before I even get in the taxi. I have been uniformly cheated by taxi drivers everywhere in the world. that alone would have me using rideshares even if it was a little more expensive.

diegoperini 5y ago

I agree. I also like 10% improvements.

danpalmer 5y ago
So do I! I'm not sure they justify multi-billion-dollar valuations though.
- amelius 5y ago
  Yeah, someone wrote a CRUD app to do ride sharing and now somehow their worth is in the same ballpark as a semiconductor superpower.
- freewilly1040 5y ago
  A 10% improvement over an incumbent means a complete takeover of the industry.
  - mantas 5y ago
    Assuming that incumbent does not improve...
  - danpalmer 5y ago
    These percentages are all subjective, I'm just trying to illustrate a point. I don't think it does mean a complete takeover. There are plenty of industries where being 10% cheaper doesn't mean you "win", and there are plenty where being 10% better doesn't either. In a world of perfect competition and perfect information it might, but it's well accepted that we do not live in that world.
    - freewilly1040 5y ago
      It's an odd argument to make in the context of Uber/Lyft, which have indeed "won" by any reasonable definition, and handsomely rewarded it's investors (which should be victims in the overhype / under deliver scenario).
- Bombthecat 5y ago
  10 percent improvement from a local small taxi company vs a worldwide company? It does make sense..
- marcosdumay 5y ago
  You mean you don't like a bunch of rich people throwing money away so you get a 10% improvement on some service? I only have a problem with them trying to make it out on the IPO instead of making a profitable business. But this one can not go forever, or the public will wake-up, or the law enforcement will.

davidweatherall 5y ago

How can you say Uber is a crap service? Compared to the predecessor of hailing a taxi, the consumer experience of hiring an Uber far exceeds it.

_ea1k 5y ago
Uber is basically the McDonald's of hired transportation. There are limitations, the experience definitely isn't premium, but its ultimately a fairly consistent purchasing experience that works most of the time. Regular taxis? Sure, download this city specific app. Or one of the two city specific apps. Or call one of the local cab companies and find out you picked the one that doesn't consistently dispatch to your hotel so you end up waiting around with zero feedback. Or maybe you call and they show up in five minutes and its great.
danpalmer 5y ago
For taxis, depends where you are and what other taxis you were booking. Compared to a London Black Cab, much better, compared to a licenced minicab, about the same but via an app instead of a phone call. For Uber Eats though, I've had them claim that there is no expectation of food arriving hot. First few times I had delivery problems I got full refunds and the reputation was always "give it a go, worst case you can get a refund anyway". Now it's hard to even get in touch with support let alone get them to acknowledge an order issue, and refunds are almost unheard of. Edit: I had forgotten about all the issues with sexual assaults by Uber drivers. They tried to downplay the issues, but ended up having to implement a lot of controls to understand who was driving the cars, in some markets they now have to be licenced, it's all changed a lot since the beginning because of how the service was actively dangerous compared to incumbents who were typically much more tightly regulated.
- leoedin 5y ago
  The Uber experience is (or at least used to be before covid) way, way better than London minicabs used to be. Minicabs had no accountability and small fleet sizes - so at peak times they'd either turn up really late or not turn up at all, with no recourse. I think they've forced everyone to change now - if they disappeared tomorrow another operator would fill the void. But when Uber first started operating it was a radically improved service.

lhorie 5y ago

> crap service is made up for with liberal refunding Uber has crap service? I was under the impression the whole point of Uber becoming so ubiquitous as to become a verb was that you could actually get service at all in a timely fashion whereas cabs had a terrible reputation. IMHO, if you're only looking at rides, you've got your consumer hat on and I think you're missing the big picture. Uber is still not done trying to eat the world so to speak. The food delivery vertical is one of its most well known growth markets, but it also has eyes on the actual hailable taxi market[0], buses/high capacity vehicles[1], deliveries/logistics market (uber direct[2], uber freight[3]), it's building up loyalty program strategies a la costco/amazon prime/visa (uber pass[4]), etc. Basically, anything that remotely involves wheels is game for Uber. This thirst is what I think characterizes unicorns: Google started as a one trick pony with search, and now has maps, docs, android, GCP, Waymo and a million other things. Amazon was a just a book store and now it's basically synonymous with online shopping and cloud infrastructure services. [0] https://www.themuse.com/jobs/uber/hailables-lead https://www.themuse.com/jobs/uber/hailables-lead [1] https://www.uber.com/en-EG/blog/introducing-uber-bus-a-new-way-to-commute/ https://www.uber.com/en-EG/blog/introducing-uber-bus-a-new-w... [2] https://www.uber.com/newsroom/moving-more-of-what-matters-with-delivery/ https://www.uber.com/newsroom/moving-more-of-what-matters-wi... [3] https://www.uber.com/us/en/freight/ https://www.uber.com/us/en/freight/ [4] https://www.uber.com/us/en/ride/how-it-works/uber-pass/ https://www.uber.com/us/en/ride/how-it-works/uber-pass/

gonehome 5y ago
Agreed - Uber is amazing and I’m glad they pushed through all of the regulatory bullshit to defeat cabs. I can call a car from almost anywhere in the world and have a ride in a few minutes for a reasonable price - that’s a huge shift.
- kbsspl 5y ago
  >Uber is amazing and I’m glad they pushed through all of the regulatory bullshit to defeat cabs. Remember, effectively you have said law breaking is acceptable. In this case, it may be partly even true, but once this catches on, anarchy, literally one step away.

tfehring 5y ago

Buying books online is a counterexample if anything. Books are a great product to sell online because they're relatively compact, there are a ton of them (way too many to have them all in a single physical bookstore), and two copies of the same new book are generally undifferentiated (unlike, say, produce). At least based on the way Bezos and other early insiders talk about it decades later, Amazon was never intended to be just a bookstore, but they were pretty intentional about starting with books.

alphadelphi 5y ago

It looks like a reference to the hype cycle https://en.wikipedia.org/wiki/Gartner_hype_cycle https://en.wikipedia.org/wiki/Gartner_hype_cycle

amelius 5y ago

You forgot to mention peak-hype, when the original investors sell their shares and laugh their way to the bank, while the subsequent buyers are left with a company of questionable value. This is what keeps these cycles going.

manigandham 5y ago

It's more than a 100% improvement for me. I've taken thousands of rides, safely and easily, using a single app across countries and currencies without any major issue. It's also opened up travel in big cities and foreign regions that I wouldn't otherwise be able to do at all. There's no alternative to this and it's incredibly valuable to many, even if you don't use it.

mint2 5y ago

Amazon just sent us an actual paper catalog in the mail for clothing and gifts. Web shopping killed catalogs and now the biggest online store is sending me catalogs. I think it’s an admission their site is an un-curated mess. but come on, are paper catalogs really the best solution Amazon came up with for their online store being cluttered, useless for product discovery, and overrun by poor quality products and fakes?

ljf 5y ago
I sometimes feel like it is only me that suffers this - finding anything of quality on amazon is a pain. Unless I know the exact model number, chances are I'll be sold low quality stuff. I want some wine glasses, picture looks OK, reviews seem good - turn up - junk. I want to find a monitor - good luck! I want to find some light bulbs... Erm yeah, same. Time was it was good as you knew it was cheaper than most places but that is generally totally not true now.

jaredklewis 5y ago

> crap service Sorry, but Uber is a 100% improvement service improvement over cabs in many areas. I lived in Chicago for six years and not one single cab I took during the whole six years would accept a credit card, despite being obligated to do so. If I didn't have cash I was told that we could drive to an ATM or I could get out. Not to mention that the drivers almost invariably talked on the phone the entire time. And while not the norm, I had half a dozen confrontations with cab drivers who were obviously trying to scam me with "broken meters" or obviously roundabout routes. I haven't had a single bad experience with an uber or lyft. Most are unremarkable, which is fine. So 100% of my cab experiences in Chicago were bad and 100% of my uber/lfyt experiences have been fine or better. Of course not everywhere is Chicago (though US cab companies generally seem to have miserable service). Tokyo taxis have world class service, and it is perhaps not a coincidence that Uber has only a tiny presence there.

lhorie 5y ago
> Tokyo taxis have world class service, and it is perhaps not a coincidence that Uber has only a tiny presence there Funny you mention this. I actually had a bad taxi experience in Japan of all places: asked the hotel to call for one multiple times, 40 minutes later it never showed up, so I requested an Uber, and got a car in 5 minutes (this was in Kyoto, though, not Tokyo)
thehappypm 5y ago
Can't agree more. Lately I've been taking taxis from the airport, since it's usually more convenient to just wait in line at the taxi stand than to play roulette with the apps. And oftentimes cheaper. But the last time I took a taxi the damn card reader didn't work and the driver made me feel like a criminal, and I had to download some app to pay via Apple Pay.
- spookthesunset 5y ago
  Their card reader probably worked fine. My theory is the cab driver prefers to use their own payment methods because they are “off the record” and they probably turn into cash in the drivers pocket much faster than using the one provided by the cab service.

achenatx 5y ago

flew into jfk last week. Got in a taxi, driver didnt want to turn the meter on. Tried to tell me it was $80 instead of the $52 fixed rate + tolls etc. I managed to pay $65, but I had to pay in cash. the same thing happened on the way back, except my hotel called the taxi, so then the taxi driver gave the bellman $10 and wanted me to give him the $10 he had to pay the bellman (which I did). He also wanted cash and didnt turn the meter on. I worry that if I insist they turn the meter on they would stop and kick me out of the taxi. And yes Im out of practice. I used to negotiate that we use the meter and I can pay with a credit card before I even get in the taxi. I have been uniformly cheated by taxi drivers everywhere in the world. that alone would have me using rideshares even if it was a little more expensive.