2 ms·

I think you're off on most of your points. Obviously the startups are not using undocumented workers. The risks are far too high. Gross margins are more like 20

by pbreit 11y ago

I think you're off on most of your points. Obviously the startups are not using undocumented workers. The risks are far too high. Gross margins are more like 20%, which is plenty to operate such a business. Not sure how it's indentured servitude compared to any other sort of job. Not sure your point about background checks. Supply & demand works out the numbers.

mbesto 11y ago
> Obviously the startups are not using undocumented workers. If this is true, than there would be a massive supply shortage. Point is, pick one argument (undocumented) or the other (undocumented) and you're going to have a biz model flaw. > which is plenty to operate such a business. "such a business" - Sure, but not a tech driven one.
- pbreit 11y ago
  Not sure what you mean. Prices would be set in order for supply and demand to even out. The startup is unlikely to use undocumented supply because of risk. Don't understand the second point either. 20% margins is plenty. See: http://abovethecrowd.com/2013/04/18/a-rake-too-far-optimal-platformpricing-strategy/ http://abovethecrowd.com/2013/04/18/a-rake-too-far-optimal-p... And tech-driven businesses have lower marginal costs thus can succeed with lower gross margins.