This is great. More competition is great for me, the consumer. Recently Lyft and Uber have bother offered flat rate rides for $5-7 anywhere in SF. When people ask me how it can be so cheap, I always joke it's because it's a $15 ride but you're splitting it with a venture capitalist.
I wonder if either company has any serious long-term plan to make sure they are not competing in a commoditized space. Currently the services are basically indistinguishable. Sure most people have a preference one way or the other, but it's not a preference they'd stick to if the other service was a few bucks cheaper. They seem to be in lock step, doing the same things and alternating who makes the first move.
If they're not careful they will become like the airline industry. 40 years ago airlines were a glamorous new way to travel. Now they are reduced to who can offer the cheapest point-to-point ticket with 17" of leg room, customer service is an unexpected bonus.
The difference is there's a network effect. Uber & Lyft are not actually transportation companies anymore than Airbnb is a hotel company. They're networks.
So it's not just about price. It's about the size of the network, which means availability -- how fast can you hail a ride. The more drivers on the network the better the availability, so that's where the consumers look first, and so that's where the new drivers join, and so on in a virtuous cycle. Once one network reaches a tipping point and becomes dominant it will be harder for upstarts to enter the market and match the availability of the winner's gigantic network.
That's the theory at least. All this VC money is about trying to get to that tipping point where one of them takes the whole transportation network.
>This is great. More competition is great for me, the consumer. Recently Lyft and Uber have bother offered flat rate rides for $5-7 anywhere in SF. When people ask me how it can be so cheap, I always joke it's because it's a $15 ride but you're splitting it with a venture capitalist.
Competition to reduce prices by increasing efficiency is great for the consumer. Competition to increase market share by offering things at below market value by burning VC money or taking advantage of drivers is fine in the short run, but will have long term problems.[1] The other shoe has to drop, and it will either look like a huge price increase to make these companies profitable or investors losing a bunch of money.
I wouldn't compare cabs to airlines. 10% price difference between one airline to the other can be 100 to 200 dollars in a single buy , where in cabs it could be spread out in an entire year.
I agree that airline competition has been so price focused that value to consumer has been eroded, but cabs are fundamentally a simple, less pricey , decision.
I hope they become commodities regulated for safe driving and rather modern cars (no older than x years). The rest really IS icing on the cake.
One decent bet about this market is that it will become a true ride sharing(UBERpool And liftLine are working on that) market. That market have pretty decent network effect(because you need that shared trips will be as optimal as possible for all users, and people will be quite sensitive to longer AND more expensive trips, and it could also help if you met fun people,etc). Some also say that many ,even with self driving cars might use shared transport. Hard to tell.
I think this is a mis-read of the market. First, if they can get many/most of their rides to include 2+ passengers, $14/trip is easily supportable without VC subsidies.
Next, if you study Lyft a bit harder you will see that is expending a lot of energy in differentiation and getting good results, especially around driver and rider experience.
Following your airline analogy, Lyft hired Virgin America's creative guy.
the competition is an illusion. The airlines are shafting customers while making more money than ever before. There isn't serious competition domestically in the US like there is in europe. There is no Ryanair here.
My car's in the shop getting fixed so I've been using Uber and Lyft in the suburban south bay--a market of long roads, horrible traffic conditions, and high rate of personal car ownership.
Since the past week I've learned a few things:
- all the drivers have both apps running and have no loyalty
- drivers prefer uber customers, however
- drivers don't like lyft's demo of college kids and local rides, it earns them no money
- lyft drivers think uber is evil, uber drivers thinks lyft drivers are hippies
- all the international travelers coming into silicon valley have uber and used to uber service
- uber dispatches to lyft dispatches are a 5 to 1 ratio
- drivers always complain lyft keeps them afloat but doesn't get them ahead
- uber, whether intentionally or not, actually has viable career plan. an uber black driver i rode with on the lyft service explained how after selling his real estate company and investing in three lincoln escalades was able to make his money back on one of the cars after 7 months.
- all the drivers concur uber is pretty evil, don't like the 1099 relationship, hate how uber corporate doesn't support the drivers over customers or incidents, yet sadly resign and accept the situation. it's oddly depressing talking to a uber driver.
Over half a billion dollars at the E round is quite a lot to drop into a "community" instead of Uber's business.
Hopefully the money is put into innovating locally instead of international expansion because they're definitely losing the game. And when the automated cars are here it would have been the tech game's worst investment cycle.
some of your statements seem contradictory. I'm in the bay area - I'll offer my perspective.
- all the drivers have both apps running and have no loyalty
Lyft offers a very strong driver incentive, and that has kept me off of the uber platform since I moved to oakland (and drive in SF) in december.
- drivers prefer uber customers, however
In San Diego (a different market) I really hated the uber customers and preferred the college demo. In SF, I never liked the uber customers, either, and I really liked the lyft demo, so I dropped uber.
- drivers don't like lyft's demo of college kids and local rides, it earns them no money
I think that's a south bay thing. One afternoon after a meeting in Palo Alto, I attempted to escape back to the city and wound up getting vortexed into Stanford, so I just got out of there.
- lyft drivers think uber is evil, uber drivers thinks lyft drivers are hippies
- all the international travelers coming into silicon valley have uber and used to uber service
Shrug
- uber dispatches to lyft dispatches are a 5 to 1 ratio
This is a function not only of demand but also supply. In particular, in San Diego, I found that the dispatches were in a 2:1 ratio, BUT if I favored lyft rides over uber rides by strategically turning the app off, I was making significantly more per week, because lyft's "loyalty program" is strong.
- uber, whether intentionally or not, actually has viable career plan. an uber black driver i rode with on the lyft service explained how after selling his real estate company and investing in three lincoln escalades was able to make his money back on one of the cars after 7 months.
Well if this guy had some initial capital beforehand a 'real estate company' this doesn't mean much. It might be more difficult to bootstrap this from scratch, which is what you are suggesting when you say 'viable career plan'. This is also contradicted by your projection of automated cars.
By contrast, during my down time from lyft, I'm running a nonprofit research organization and also coding a backend for a startup.
- all the drivers concur uber is pretty evil, don't like the 1099 relationship, hate how uber corporate doesn't support the drivers over customers or incidents, yet sadly resign and accept the situation. it's oddly depressing talking to a uber driver.
Lyft has this 1099 relationship too, and it makes it for very tough running sometimes. But you just have to roll with the punches and keep hustling.
Lincoln Navigator, or Cadillac Escalade perhaps?
Interesting points though, even if a lot of them are contradictory. In Los Angeles, I've similarly observed most drivers using both Lyft and Uber. I imagine that the Bay Area market is more saturated and that a driver could be kept busy on just one service, but I get the feeling it's not quite up to that level in LA.
Lyft, with a valuation of around 5% that of Uber, is clearly losing this battle. However, its mere existence is causing something that is rarely seen: the transfer of billions of dollars out of the bank accounts of absurdly wealthy investors, almost directly into the hands of people at the lower end of the economy. After all, the vast majority of this money is going into incentivizing drivers to sign up/stay, and subsidizing rides.
As long as this battle goes on and investors are willing to fund it, I'll be a fan of both companies. Sadly, it won't last forever.
> the transfer of billions of dollars out of the bank accounts of absurdly wealthy investors, almost directly into the hands of people at the lower end of the economy.
This makes me happy. After having been an Uber customer, then an Uber driver, and now a Lyft customer, I'm more than happy to transition my business to Lyft. Where Uber made me feel douchey, Lyft has made me feel part of a community. Even though functionally the two services are indistinguishable, I've always had better experiences with Lyft. Lyft feels more grounded. You have the opportunity, if you wish, to sit next to your driver and not treat them as a lower class citizen. I don't hear about Lyft employees being ruthless or money-grabbing. And generally all Lyft drivers I've met have been happy Uber driver converts. I totally buy the Southwest Airlines angle they are trying to achieve.
> I totally buy the Southwest Airlines angle they are trying to achieve.
I wouldn't compare any service I actually like to Southwest Airlines. Southwest seems to be one of the least appealing airlines in terms of comfort and quality.
> And generally all Lyft drivers I've met have been happy Uber driver converts. I totally buy the Southwest Airlines angle they are trying to achieve.
I've noticed this too - the Lyft driver's are happier on average. And when you do get a rude Lyft driver, chances are they are driving for Uber too. At least this has been my experience.
Same. The way I describe the difference is that I started using ride sharing services to avoid taxis. Then all the taxi drivers started driving uberx so I switched to Lyft. It's as much about the experience as it is the convenience.
I might be missing something here because nobody else brought it up: Is this not just a necessary move to salvage investments in Lyft? Assuming Uber won already, Lyft investors need to keep it dangerous enough to force a buy out or write it off completely. Keep Lyft alive until Uber is forced to buy it pre/post IPO? At some point the Lyft competition is going to cost Uber more than the price of just buying them out. Please note that I am not a biz guy so if I am wrong I would be very happy for an explanation on how/why.
don't you think it's dangerous to argue from a monopolist position? we have laws against the type of reasoning you think Uber should be using... I'm not sure they are in a position to do as you suggest.
Im glad investors are backing Lyft even if today its the underdog compared to Uber.
Its no secret that Uber's practices provoke disgust or discomfort, and that many would wish Lyft to do better just because at least in appearences they havent been behaving as douchey as Uber.
But I'm happy because no matter how you appreciate Uber as a company in spite of their practices, there should be no monopolies, and competition is often the most healthy result to great results to consumers and to CREATE VALUE.
I hope that ALL YC companies remember that the final destination to a profit driven economy is creating value to people. A large number of companies have made their cake and made their founders and investors very rich: stop looking at the bottom line and focus on creating value. Not things you can charge and make money of. Value.
So, to ask the question that Thiel has asked, is this a market that supports a monopoly, or is it going to be a consumer-favoring highly competitive scene?
> Thiel is also an investor in Airbnb– yet another darling of the sharing economy, valued at a “mere” $10 billion compared to Uber’s $18 billion. Unlike Uber and Lyft, Thiel argued, there is no obvious competitor to Airbnb. That in and of itself makes it a more valuable company because of the distraction and profit erosion that he describes throughout his book.
Thiel seems to think that it doesn't support a monopoly, and I'd tend to agree.
So, assuming that it's a competitive market, and Uber and Lyft repeatedly copy the features of one-another, I'm very curious to see what kind of profit margins and therefore valuations are supported.
For a competitive market, it seems like the gap between Lyft's $2.5bn and Uber's $41 is bound to be reduced, one way or the other.
I support alternatives to Uber, not because they're bad or anything, but because I don't want to see a monopoly develop. Competition is the best way to ensure that we don't wind up with the next Comcast.
I think Lyft is making a major tactical mistake by using surge-pricing, and in my experience, in many cases at rates that are higher than those of Uber. While this may ensure that their drivers make a comparable amount to Uber drivers, its at precisely the times that Uber is surge-pricing at 1.7x+ that people are most-likely to look at alternate options. Indeed I've witnessed many instances of friends doing just that- checking Lyft and realizing that the cost is actually higher than Uber's and just using Uber or (gasp) an honest-to-God cab. If Lyft truly wants to land-grab from Uber, that is the most opportune time to do so.
A secondary problem is that Lyft has far too few drivers (at least in DC) to realistically compete, which probably further compounds the aforementioned problem of constant surge-pricing. IMO to compete with Uber they should use this money to get more drivers on the road in major markets and do away with surge-pricing for some time until they have reached a higher market saturation.
Yeah, you could see something working with the passengers where you say, "Okay, we'll be 1.3x the price of UberX all the time, and so we'll grab customers from Uber when they're surging (which is, after all, when most people want cars)" and some percentage of those people will become loyal customers who won't care about a small surcharge during non-surge times.
But, realize, you're also competing for drivers. And at least a substantial fraction of your drivers are entirely willing to turn you on during the non-busy times and take advantage of your higher rates, and then switch to Uber during surge to take advantage of the temporarily higher rates there. Which can be a problem for you.
There's probably a finesseable option here where you offer drivers some kind of volume-based bonus that keeps them hungry for your rides during surge times, but doesn't mean you bleed money. But it's definitely hard to hit that mark.
Source: I used to work for Flywheel, which does "hail a taxi with your smartphone" and we spent a lot of time working through these kinds of scenarios.
I've never experienced significant (higher than 1.5x) surge pricing on Lyft but have frequently with Uber. The last time I was in New York the surge was 6x on Uber. This lasted for hours. The entire weekend I was there it never dropped below 2.1x. This was not during a holiday or bad weather. It was just the weekend.
Here in Salt Lake City, Lyft already won by a long shot. Its crazy, they got here like a week or two before Uber, but their arrival seemed to just not leave any room for a competitor.
Uber can rarely be found here, and if it can its always longer and more expensive than Lyft. Long live Lyft.
Also, thank god they got rid of the mustache thing and just put the pink sticker in their back window.
Hopefully Lyft puts some of that money towards supporting more platforms that could make it competitive with Uber. I would love to have alternative options, but unfortunately, it seems like Uber is the only service that offers a Windows Phone application and a Mobile site to order off of. While there aren't too many non iOS/Android mobile phone users, all of us are collectively tied to Uber.
I think this tells us something very interesting about the startup economy: your choice of car service is dictated by the brand of mobile phone that you own.
I think it's extremely premature that people are saying Uber has won. These companies operate in a bunch of silo'd markets so for Uber to "win," they'd have to one by one take all the markets.
It's more appropriate to look at individual markets where both are competing and see how they perform relative to each other. I think Uber's higher valuation is probably due to the fact that they've aggressively expanded and are in more markets than Lyft, Sidecar, and others.
I'm a little worried. More Lyft drivers on the road might mean it's harder for me, a simple pizza delivery man, to deliver value across the city of Chicago. At the same time, I welcome Lyft to challenge Uber's dominant position - and hope they can gain market share while maintaining a stronger moral stance than the incumbent.
why do you mention being a simple pizza delivery man in all your comments?
One of your recent comments:
>Well, that's possible with compile-to-JavaScript languages. Also you have the option of plugins like Unity, if you're going for something graphically adventurous.
>That being said, JavaScript is a powerful tool, if wielded correctly. It's so flexible. In a lot of ways, it's like a pizza. One man orders a pizza with anchovies, another with green peppers. And on and on. Eventually it's like they've got two completely different dinners.
if you know about compile-to-JavaScript languages, and consider JavaScript a powerful tool and so flexible, why are you a pizza delivery man? (An unskilled job requiring no training.) Why don't you get skilled work as a programmer, even entry-level?
And why would you make an inappopriate pizza analogy in a thread about javascript, or mention
>When I knock on someone's door, and then hand them a hot box of pizza, they smile and often hand me money: $5's, $10's, sometimes a $100. I'm just doing my job, just like this Harlan "Father Time" Stenn. I suppose we take for granted, that which we can't see.
in a way that is completely unrelated to the story you posted it under? Are you using this as a 'novelty account'?
I think this industry is going to end up exactly like the airline industry. IE: no margins to speak of really.
I just can't see how one company can ever have a long term competitive advantage. I think any current perceived advantage is down to the amount of VC cash flowing in and also how abysmal the old school taxi competition is.
When does Lyft expand internationally? The value of this kind of ride-sharing apps to me is primarily when I'm traveling. Getting reliable rides in a foreign country is such a gigantic hassle. Uber seems to be only international ride-sharing app nowadays.
More competition is surely better for the consumer. As I'm based in London, I'm very much an Uber customer but I hope to see the pink moustaches driving around Buckingham Palace soon! Will be interesting to see how they plan to expand to the UK...
For once I get to disagree with A16Z, "Scott Weiss, general partner at Lyft investor Andreessen Horowitz, sees the company beating Uber by emphasizing better customer service...he compares Lyft’s opportunity to Southwest Airlines and Virgin America"
I don't believe the comparison is correct. Catching an Uber is a quick decision process. I don't believe the change will be big enough to convert Uber users to install Lyft's app. They would have spend all that money raised and give it a way to get Lyft customer to refer friends with a free-ride coupon codes.
I'm curious where these companies and driverless cars intersect. I guess Uber transitions to driverless cars and cuts costs. It's crazy to think about. It's more or less cheap driverless taxis.
I still prefer Uber because it's nicer than Lyft. Not uberx of course, but even then uberx is basically on par with all Lyft drivers. If I'm paying for a car service, I don't derive much value from a fist bump. I want a bottle of water in the back seat, tinted windows and the door opened for me - and the few extra dollars is more than worth it. Yes competition is good, but which supporting demographic do you think will keep a company afloat? I'm betting on the people that fly business class. There are good reasons Uber attracts the big money investors.
I'm inclined to believe you simply based on evidence. Uber is till, by far, the choice for most. Moreover Travis Kalanick seems to have the passion for efficient transportation as Steve Jobs did for Apple products.
And I suspect there is some biased on Hacker News in favor of Lyft. Thiel is now even a partner of Y Combinator. And if I was Lyft, I'd rely on the passion of techies and engineers to push Lyft's "benevolent underdog" fight against the "evils of the goliath" Uber.
[+] [-] habosa|11 years ago|reply
I wonder if either company has any serious long-term plan to make sure they are not competing in a commoditized space. Currently the services are basically indistinguishable. Sure most people have a preference one way or the other, but it's not a preference they'd stick to if the other service was a few bucks cheaper. They seem to be in lock step, doing the same things and alternating who makes the first move.
If they're not careful they will become like the airline industry. 40 years ago airlines were a glamorous new way to travel. Now they are reduced to who can offer the cheapest point-to-point ticket with 17" of leg room, customer service is an unexpected bonus.
[+] [-] calcsam|11 years ago|reply
https://twitter.com/StartupLJackson/status/40813723253330329...
[+] [-] abalone|11 years ago|reply
So it's not just about price. It's about the size of the network, which means availability -- how fast can you hail a ride. The more drivers on the network the better the availability, so that's where the consumers look first, and so that's where the new drivers join, and so on in a virtuous cycle. Once one network reaches a tipping point and becomes dominant it will be harder for upstarts to enter the market and match the availability of the winner's gigantic network.
That's the theory at least. All this VC money is about trying to get to that tipping point where one of them takes the whole transportation network.
[+] [-] cmsmith|11 years ago|reply
Competition to reduce prices by increasing efficiency is great for the consumer. Competition to increase market share by offering things at below market value by burning VC money or taking advantage of drivers is fine in the short run, but will have long term problems.[1] The other shoe has to drop, and it will either look like a huge price increase to make these companies profitable or investors losing a bunch of money.
[1] see Groupon et al.
[+] [-] conanbatt|11 years ago|reply
I agree that airline competition has been so price focused that value to consumer has been eroded, but cabs are fundamentally a simple, less pricey , decision.
I hope they become commodities regulated for safe driving and rather modern cars (no older than x years). The rest really IS icing on the cake.
[+] [-] minthd|11 years ago|reply
[+] [-] pbreit|11 years ago|reply
Next, if you study Lyft a bit harder you will see that is expending a lot of energy in differentiation and getting good results, especially around driver and rider experience.
Following your airline analogy, Lyft hired Virgin America's creative guy.
[+] [-] kashkhan|11 years ago|reply
http://hub.aa.com/en/nr/pressrelease/american-airlines-group...
http://www.latimes.com/business/la-fi-airlines-fuel-hedging-...
http://aviationblog.dallasnews.com/2014/09/sevem-u-s-carrier...
If it was a honest competitive market the fuel cost savings would be passed on to the customers.
[+] [-] joelthelion|11 years ago|reply
[+] [-] alaskamiller|11 years ago|reply
Since the past week I've learned a few things:
- all the drivers have both apps running and have no loyalty
- drivers prefer uber customers, however
- drivers don't like lyft's demo of college kids and local rides, it earns them no money
- lyft drivers think uber is evil, uber drivers thinks lyft drivers are hippies
- all the international travelers coming into silicon valley have uber and used to uber service
- uber dispatches to lyft dispatches are a 5 to 1 ratio
- drivers always complain lyft keeps them afloat but doesn't get them ahead
- uber, whether intentionally or not, actually has viable career plan. an uber black driver i rode with on the lyft service explained how after selling his real estate company and investing in three lincoln escalades was able to make his money back on one of the cars after 7 months.
- all the drivers concur uber is pretty evil, don't like the 1099 relationship, hate how uber corporate doesn't support the drivers over customers or incidents, yet sadly resign and accept the situation. it's oddly depressing talking to a uber driver.
Over half a billion dollars at the E round is quite a lot to drop into a "community" instead of Uber's business.
Hopefully the money is put into innovating locally instead of international expansion because they're definitely losing the game. And when the automated cars are here it would have been the tech game's worst investment cycle.
[+] [-] findjashua|11 years ago|reply
"lyft drivers think uber is evil, uber drivers thinks lyft drivers are hippies"
??
[+] [-] mfringel|11 years ago|reply
Does the owner of the vehicles lease the vehicles out to drivers who then use them to provide Uber Black-car service?
[+] [-] dnautics|11 years ago|reply
- all the drivers have both apps running and have no loyalty
Lyft offers a very strong driver incentive, and that has kept me off of the uber platform since I moved to oakland (and drive in SF) in december.
- drivers prefer uber customers, however
In San Diego (a different market) I really hated the uber customers and preferred the college demo. In SF, I never liked the uber customers, either, and I really liked the lyft demo, so I dropped uber.
- drivers don't like lyft's demo of college kids and local rides, it earns them no money
I think that's a south bay thing. One afternoon after a meeting in Palo Alto, I attempted to escape back to the city and wound up getting vortexed into Stanford, so I just got out of there.
- lyft drivers think uber is evil, uber drivers thinks lyft drivers are hippies - all the international travelers coming into silicon valley have uber and used to uber service
Shrug
- uber dispatches to lyft dispatches are a 5 to 1 ratio
This is a function not only of demand but also supply. In particular, in San Diego, I found that the dispatches were in a 2:1 ratio, BUT if I favored lyft rides over uber rides by strategically turning the app off, I was making significantly more per week, because lyft's "loyalty program" is strong.
- uber, whether intentionally or not, actually has viable career plan. an uber black driver i rode with on the lyft service explained how after selling his real estate company and investing in three lincoln escalades was able to make his money back on one of the cars after 7 months.
Well if this guy had some initial capital beforehand a 'real estate company' this doesn't mean much. It might be more difficult to bootstrap this from scratch, which is what you are suggesting when you say 'viable career plan'. This is also contradicted by your projection of automated cars.
By contrast, during my down time from lyft, I'm running a nonprofit research organization and also coding a backend for a startup.
- all the drivers concur uber is pretty evil, don't like the 1099 relationship, hate how uber corporate doesn't support the drivers over customers or incidents, yet sadly resign and accept the situation. it's oddly depressing talking to a uber driver.
Lyft has this 1099 relationship too, and it makes it for very tough running sometimes. But you just have to roll with the punches and keep hustling.
[+] [-] chambo622|11 years ago|reply
Lincoln Navigator, or Cadillac Escalade perhaps? Interesting points though, even if a lot of them are contradictory. In Los Angeles, I've similarly observed most drivers using both Lyft and Uber. I imagine that the Bay Area market is more saturated and that a driver could be kept busy on just one service, but I get the feeling it's not quite up to that level in LA.
[+] [-] downandout|11 years ago|reply
As long as this battle goes on and investors are willing to fund it, I'll be a fan of both companies. Sadly, it won't last forever.
[+] [-] cubano|11 years ago|reply
Aren't those AKA paychecks?
[+] [-] rhizome|11 years ago|reply
Case in point: http://imgur.com/jbfcLpV.jpg
[+] [-] physcab|11 years ago|reply
[+] [-] JoshTriplett|11 years ago|reply
I wouldn't compare any service I actually like to Southwest Airlines. Southwest seems to be one of the least appealing airlines in terms of comfort and quality.
[+] [-] ChrisAntaki|11 years ago|reply
I've noticed this too - the Lyft driver's are happier on average. And when you do get a rude Lyft driver, chances are they are driving for Uber too. At least this has been my experience.
[+] [-] wcummings|11 years ago|reply
This might say more about you than Uber or Lyft. Why is sitting in the back treating them like a "lower class citizen"?
[+] [-] jsonne|11 years ago|reply
[+] [-] meowface|11 years ago|reply
[+] [-] starmole|11 years ago|reply
[+] [-] lexap|11 years ago|reply
[+] [-] diminoten|11 years ago|reply
[+] [-] logicallee|11 years ago|reply
[+] [-] conanbatt|11 years ago|reply
But I'm happy because no matter how you appreciate Uber as a company in spite of their practices, there should be no monopolies, and competition is often the most healthy result to great results to consumers and to CREATE VALUE.
I hope that ALL YC companies remember that the final destination to a profit driven economy is creating value to people. A large number of companies have made their cake and made their founders and investors very rich: stop looking at the bottom line and focus on creating value. Not things you can charge and make money of. Value.
[+] [-] StartupLSatoshi|11 years ago|reply
So, to ask the question that Thiel has asked, is this a market that supports a monopoly, or is it going to be a consumer-favoring highly competitive scene?
> Thiel is also an investor in Airbnb– yet another darling of the sharing economy, valued at a “mere” $10 billion compared to Uber’s $18 billion. Unlike Uber and Lyft, Thiel argued, there is no obvious competitor to Airbnb. That in and of itself makes it a more valuable company because of the distraction and profit erosion that he describes throughout his book.
Thiel seems to think that it doesn't support a monopoly, and I'd tend to agree.
So, assuming that it's a competitive market, and Uber and Lyft repeatedly copy the features of one-another, I'm very curious to see what kind of profit margins and therefore valuations are supported.
For a competitive market, it seems like the gap between Lyft's $2.5bn and Uber's $41 is bound to be reduced, one way or the other.
[+] [-] gkanapathy|11 years ago|reply
I found this analysis to be the most compelling thing supporting alternatives to Uber that I've ever read: http://www.interfluidity.com/v2/5822.html
[+] [-] dkrich|11 years ago|reply
A secondary problem is that Lyft has far too few drivers (at least in DC) to realistically compete, which probably further compounds the aforementioned problem of constant surge-pricing. IMO to compete with Uber they should use this money to get more drivers on the road in major markets and do away with surge-pricing for some time until they have reached a higher market saturation.
[+] [-] aetherson|11 years ago|reply
But, realize, you're also competing for drivers. And at least a substantial fraction of your drivers are entirely willing to turn you on during the non-busy times and take advantage of your higher rates, and then switch to Uber during surge to take advantage of the temporarily higher rates there. Which can be a problem for you.
There's probably a finesseable option here where you offer drivers some kind of volume-based bonus that keeps them hungry for your rides during surge times, but doesn't mean you bleed money. But it's definitely hard to hit that mark.
Source: I used to work for Flywheel, which does "hail a taxi with your smartphone" and we spent a lot of time working through these kinds of scenarios.
[+] [-] dopamean|11 years ago|reply
[+] [-] elliotec|11 years ago|reply
Uber can rarely be found here, and if it can its always longer and more expensive than Lyft. Long live Lyft.
Also, thank god they got rid of the mustache thing and just put the pink sticker in their back window.
[+] [-] FlyingLawnmower|11 years ago|reply
[+] [-] techstrategist|11 years ago|reply
[+] [-] JohnLen|11 years ago|reply
[+] [-] chrischen|11 years ago|reply
It's more appropriate to look at individual markets where both are competing and see how they perform relative to each other. I think Uber's higher valuation is probably due to the fact that they've aggressively expanded and are in more markets than Lyft, Sidecar, and others.
[+] [-] ChrisAntaki|11 years ago|reply
[+] [-] logicallee|11 years ago|reply
One of your recent comments:
>Well, that's possible with compile-to-JavaScript languages. Also you have the option of plugins like Unity, if you're going for something graphically adventurous.
>That being said, JavaScript is a powerful tool, if wielded correctly. It's so flexible. In a lot of ways, it's like a pizza. One man orders a pizza with anchovies, another with green peppers. And on and on. Eventually it's like they've got two completely different dinners.
if you know about compile-to-JavaScript languages, and consider JavaScript a powerful tool and so flexible, why are you a pizza delivery man? (An unskilled job requiring no training.) Why don't you get skilled work as a programmer, even entry-level?
And why would you make an inappopriate pizza analogy in a thread about javascript, or mention
>When I knock on someone's door, and then hand them a hot box of pizza, they smile and often hand me money: $5's, $10's, sometimes a $100. I'm just doing my job, just like this Harlan "Father Time" Stenn. I suppose we take for granted, that which we can't see.
in a way that is completely unrelated to the story you posted it under? Are you using this as a 'novelty account'?
[+] [-] pgodzin|11 years ago|reply
[+] [-] martinald|11 years ago|reply
I just can't see how one company can ever have a long term competitive advantage. I think any current perceived advantage is down to the amount of VC cash flowing in and also how abysmal the old school taxi competition is.
[+] [-] jerguismi|11 years ago|reply
[+] [-] itschaffey|11 years ago|reply
[+] [-] salimmadjd|11 years ago|reply
I don't believe the comparison is correct. Catching an Uber is a quick decision process. I don't believe the change will be big enough to convert Uber users to install Lyft's app. They would have spend all that money raised and give it a way to get Lyft customer to refer friends with a free-ride coupon codes.
[+] [-] cndl-mkr-lvl-9|11 years ago|reply
[+] [-] xacaxulu|11 years ago|reply
[+] [-] closetnerd|11 years ago|reply
And I suspect there is some biased on Hacker News in favor of Lyft. Thiel is now even a partner of Y Combinator. And if I was Lyft, I'd rely on the passion of techies and engineers to push Lyft's "benevolent underdog" fight against the "evils of the goliath" Uber.
[+] [-] nicholasdrake|11 years ago|reply