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Leaked Uber financials from 2012 to 2014

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Re: Leaked Uber financials from 2012 to 2014

#41

Post by duncanawoods »

puranjay wrote: post #37
rtpg wrote: post #6

Wait, so Uber spent $900 million dollars? I thought that considering they offload so much of the costs of running of the business( EDIT: through having drivers buy the cars, for example), they wouldn't have such high operating costs. Though according to this[1] article, Uber's at 3000 employees worldwide. What are those employees doing? EDIT: For reference, Greyhound's 2014 operating costs were 600 million pounds (50…

Uber is active pretty much everywhere. They're truly aiming to corner the entire global transport market. They're putting in $1B in India alone. When the dust is settled, you're going to get a company that controls the private transport industry in an area that stretches from San Francisco to Kolkata For an industry that was once dominated by small local players, this is truly mind blowing. I don't think there is a s…

>> controls the private transport industry

But is their money buying control of anything? They are not buying control over a resource, like "all the tin mines in China" or something. Is it just spend on market creation that a fast follower can piggy back on for free?

Re: Leaked Uber financials from 2012 to 2014

#42

Post by danieltillett »

friendzis wrote: post #28
danieltillett wrote: post #12

Earlier quoted context omitted.

In theory if they can lower the costs substantially through innovation over the current taxi model they can grow the market out of private car usage. This would mean all parties (except car manufacturers) will benefit.

In transportation business major costs are vehicle depreciation/maintenance/consumables (fuel, insurance, tires, etc), wages and you can include domain specific expenses (insurance, driver health chek-ups). * You can't reduce DS expenses. You can offload them to drivers, but that will still be reflected in prices * You can reduce wage cost by eliminating administrative load by having tools (apps, backends) do the job…

You noticed I said in theory - what you have raised is the practice :)

Personally I think a lot of Uber business model is hidden cost shifting onto the driver and society. Drivers are underestimating the true cost of being a Uber driver and society is losing out via inadequate insurance and tax avoidance. The drivers are not taking out the correct insurance and a lot of them are not declaring their income or collecting sales tax. I guess as long as it is all done on an app then it must be cool and OK.

Re: Leaked Uber financials from 2012 to 2014

#43

Post by [deleted] »

joshjkim wrote: post #30

Basic rundown of Rev / Loss from reports: Q1.12: 1.4M / 3.4M Q2.12: 2.1M /2.3M Q3.12: 4.3M / 5.4M Q4.12: 8.2M / 7.0M Q1.13: 12.9M / 7.3M Q2.13: 19.3M / 8.1M 2013 (total): 104M / 56M Q1.14: 45.6M / 52.2M Q2.13: 56.9M / 108.8M Rev grew faster than losses consistently all through 2012 and 2013 which is really amazing (2013 is when Uber jumped from a 330M valuation to a 3.5B valuation so investors noticed too)...then los…

[deleted]

Re: Leaked Uber financials from 2012 to 2014

#44

Post by rodgerd »

puranjay wrote: post #37
rtpg wrote: post #6

Wait, so Uber spent $900 million dollars? I thought that considering they offload so much of the costs of running of the business( EDIT: through having drivers buy the cars, for example), they wouldn't have such high operating costs. Though according to this[1] article, Uber's at 3000 employees worldwide. What are those employees doing? EDIT: For reference, Greyhound's 2014 operating costs were 600 million pounds (50…

Uber is active pretty much everywhere. They're truly aiming to corner the entire global transport market. They're putting in $1B in India alone. When the dust is settled, you're going to get a company that controls the private transport industry in an area that stretches from San Francisco to Kolkata For an industry that was once dominated by small local players, this is truly mind blowing. I don't think there is a s…

> When the dust is settled, you're going to get a company that controls the private transport industry in an area that stretches from San Francisco to Kolkata

Yay! Disintermediation! Smashing monopolies!

Oh, wait.

Re: Leaked Uber financials from 2012 to 2014

#45

Post by mootothemax »

icpmacdo wrote: post #2

I dont think Uber is going anywhere soon. It has such a strong brand. Everyone I know trusts uber a lot more than there local cab companies.

I dont think Uber is going anywhere soon. It has such a strong brand. Everyone I know trusts uber a lot more than there local cab companies.

They seem to be following the same pattern as large supermarkets:

- Move into an unserved area

- Offer goods/services at rock-bottom prices

- As competition reduces, increase prices and squeeze suppliers

- Profit, profit, profit!

An interesting example of this is Tesco (https://en.wikipedia.org/wiki/Tesco), who at one point were receiving one pound in seven spent in the UK. According to the wiki, that's now widened to one in every ten pounds.

The other interesting angle is that Tesco have been hugely profitable until this year, when they reported a loss of nearly six billion pounds. We'll have to see what happens next.

Re: Leaked Uber financials from 2012 to 2014

#46

Post by morgante »

krrrh wrote: post #36
morgante wrote: post #27

Earlier quoted context omitted.

> I do wonder what will happen once Uber starts charging market rates. Right now, your ride is subsidized by Uber. Do you have any evidence of that? I'm 99% sure Uber is profitable on a unit and customer basis.

There is evidence of this all over the press if you want to search for it. Take for instance The 'non-profit' "People's Uber" in China. They guaranteed wages for drivers and capped rates at auto rickshaw prices. This spring in Guangzhou I was taking 20 minute rides and paying around $1.50. It was ridiculous. While they were trying to maintain a foothold in Germany as more than a legal taxi hailing service (which is w…

> they are definitely paying a price for expansion.

Of course, that's the whole reason to raise capital (so you can expand rapidly on a model which has attractive unit economics).

The point is that we don't have to speculate about what will happen once Uber raises prices. Just look at their mature markets, where pricing is on par with taxis, and you can see a profitable model.

Re: Leaked Uber financials from 2012 to 2014

#47

Post by beagle3 »

puranjay wrote: post #37
rtpg wrote: post #6

Wait, so Uber spent $900 million dollars? I thought that considering they offload so much of the costs of running of the business( EDIT: through having drivers buy the cars, for example), they wouldn't have such high operating costs. Though according to this[1] article, Uber's at 3000 employees worldwide. What are those employees doing? EDIT: For reference, Greyhound's 2014 operating costs were 600 million pounds (50…

Uber is active pretty much everywhere. They're truly aiming to corner the entire global transport market. They're putting in $1B in India alone. When the dust is settled, you're going to get a company that controls the private transport industry in an area that stretches from San Francisco to Kolkata For an industry that was once dominated by small local players, this is truly mind blowing. I don't think there is a s…

They're spending an awful lot for control of a market that is expected to disappear within a few years when self driving cars mature.

Of course, they are aware of it and are investing in being a leader in that market - but they're fighting with global giants over there, not the local Taxi outfits.

Re: Leaked Uber financials from 2012 to 2014

#48

Post by mattmanser »

jfoster wrote: post #31
empressplay wrote: post #8

So what's the model? Put the taxis out of business and then jack up the fares to what the taxis were? Who's winning, then, exactly? Not the consumer...

It's actually build a better service, give each user subsidized (or free) rides so they get to experience how much better the new service is, then stop handing out free rides like candy.

You just said the same thing, but framed as a positive.

Use VC money to put taxis out of business then jack up the price and let the service level plummet as cheap immigrants become the drivers.

Re: Leaked Uber financials from 2012 to 2014

#49

Post by brc »

danieltillett wrote: post #12
empressplay wrote: post #8

So what's the model? Put the taxis out of business and then jack up the fares to what the taxis were? Who's winning, then, exactly? Not the consumer...

In theory if they can lower the costs substantially through innovation over the current taxi model they can grow the market out of private car usage. This would mean all parties (except car manufacturers) will benefit.

Car manufacturers will benefit.

What matters is passenger miles driven, not total number of unique car sales.

If you open up a new pocket of driving demand because it's easier to get a lift, then the total passenger miles driven goes up. Even more so if it is a pickup/dropoff model with 'empty miles'.

More miles driven->Cars worn out faster->more sales. More sales of likely generic cars less obsessed with expensive annual styling tweaks. More sales -> fewer models -> longer model runs = more profit.

I'd say the car companies are happy.

Re: Leaked Uber financials from 2012 to 2014

#50

Post by brc »

sbank wrote: post #34
aikah wrote: post #17

Earlier quoted context omitted.

> I do wonder what will happen once Uber starts charging market rates. That's an excellent question and the answer is it wont be cheap. That's why, in countries where Uber operates, a clear legal framework is needed so that Uber doesn't end up with a monopoly. If Uber is allowed to operate somewhere then anybody should be able to do that without the need for an army of lawyers and lobbyists or it's just replacing the…

Private monopolies are largely unproblematic as they will be destroyed by more effective competitors eventually. I'm way more afraid of government monopoly. Point in case: The protectionism and government interference that has kept the taxi business shitty for so long.

I find it ironic that people are warning about 'oooh, Uber monopoly' when their business model is all about deconstructing actual government monopolies.

Uber already has competitors in major markets. The market has very low switching costs. A new competitor doesn't even have to educate the customer on what to expect, or how it works, or even how to find drivers. All this has now been worked out, so any price gouging can be easily competed with.

I can only conclude those who want to 'regulate' Uber for the 'betterment of society' are severely long Taxi licences, or are hardcore socialists who abhor any economic freedom of agency, or maybe both.

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