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> Uber thought its capital would be best used to run a fleet of cars, it would simply hire people straight out to be drivers. That it’s not doing that suggests

> Uber thought its capital would be best used to run a fleet of cars, it would simply hire people straight out to be drivers. That it’s not doing that suggests something. Uber buying a bunch of cars and hiring a bunch of people to drive them is FAR less in line with market principals than using that capital to help other people start their own small businesses, so they can work on their own terms and set their own hours.

rayiner 13y ago
I wouldn't put it that way. There's an economies of scale advantage to buying cars and hiring drivers. So that option isn't any less in line with "market principles." The reason Uber doesn't buy cars and hire drivers is: 1) it insulates them from legal liability; and 2) they get to use other peoples' capital instead of putting up their own.
- MarkPNeyer 13y ago
  hiring drivers means hiring managers and administering 401k plans and meetings and dress codes and did you get the goddamn memo or not financing contractors means lots of minds making their own value judgements, risking their own resources and gaining more of the rewards for themselves.
- dctoedt 13y ago
  > The reason Uber doesn't buy cars and hire drivers is: 1) it insulates them from legal liability .... Uber hopes it will do that, and to a certain extent it very well might --- but personal-injury plaintiffs' lawyers are remarkably creative in coming up with arguments why they should be allowed to recover damages (and percentage-of-the-recovery contingent fees) from any deep pockets in sight. Sometimes, some of those arguments succeed in persuading judges. On a tangential note, I predict someday soon some subset of Uber drivers will be suing Uber for overtime, unemployment benefits, etc., on grounds that, no matter what the contracts say, under the law the drivers purportedly are "employees," not independent contractors. [1] This is a not-infrequent occurrence with delivery-service drivers; see, e.g., Narayan v. EGL Inc., 616 F.3d 895, 898-99 (9th Cir. 2010) [2]. [1] I've long thought that much of legal advocacy could be summed up in two words: Yeah, but .... [2] http://scholar.google.com/scholar_case?case=18394214241619035573 http://scholar.google.com/scholar_case?case=1839421424161903...

rayiner 13y ago

I wouldn't put it that way. There's an economies of scale advantage to buying cars and hiring drivers. So that option isn't any less in line with "market principles." The reason Uber doesn't buy cars and hire drivers is: 1) it insulates them from legal liability; and 2) they get to use other peoples' capital instead of putting up their own.

MarkPNeyer 13y ago
hiring drivers means hiring managers and administering 401k plans and meetings and dress codes and did you get the goddamn memo or not financing contractors means lots of minds making their own value judgements, risking their own resources and gaining more of the rewards for themselves.
dctoedt 13y ago
> The reason Uber doesn't buy cars and hire drivers is: 1) it insulates them from legal liability .... Uber hopes it will do that, and to a certain extent it very well might --- but personal-injury plaintiffs' lawyers are remarkably creative in coming up with arguments why they should be allowed to recover damages (and percentage-of-the-recovery contingent fees) from any deep pockets in sight. Sometimes, some of those arguments succeed in persuading judges. On a tangential note, I predict someday soon some subset of Uber drivers will be suing Uber for overtime, unemployment benefits, etc., on grounds that, no matter what the contracts say, under the law the drivers purportedly are "employees," not independent contractors. [1] This is a not-infrequent occurrence with delivery-service drivers; see, e.g., Narayan v. EGL Inc., 616 F.3d 895, 898-99 (9th Cir. 2010) [2]. [1] I've long thought that much of legal advocacy could be summed up in two words: Yeah, but .... [2] http://scholar.google.com/scholar_case?case=18394214241619035573 http://scholar.google.com/scholar_case?case=1839421424161903...