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Uber Turns to Saudi Arabia for $3.5B Cash Infusion

nytimes.com

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Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#221

Post by tracker1 »

Spooky23 wrote: post #171
methehack wrote: post #82

I've always been a little confused about uber's capital needs. When I first heard about uber, the part I thought was super-clever was that you wouldn't _need_ lots of capital because all the drivers would have their own cars. Leveraging the latent capital of one side of the two-sided market was the genius of it. (Airbnb too) Same for the staffing -- hook up both sides of the market. No need to pay anyone out of your…

Über has enchanted the tech people. It's this golden goose that every conversation turns to. Listen to the Ben Thompson podcast -- if he was reacting to an article about ham sandwiches, he would tie it to Uber. There's no reality here. No magic self driving electric taxis, no robot delivering your takeout. 18-24 months this thing will be like Groupon (remember they were magically saving writers by hiring thousands of…

For those curious... 100k / 20 / 365 = $13/day, at $3/gallon (est) = 4.56 gallons * 20mpg (low gas milage) = 91 miles/day, or closer to 30mpg would be around 135miles/day, which I guess is possible. I was just thinking it seemed like a lot. Now, a fair amount of that is varying levels of taxes... but it's still significant amount.

I'm currently doing about 40 miles/day commute for work, and know people who are driving a lot farther than I am... while I was married, I'd drive about 140 miles to/from home on the weekends, staying in the city during the week, put many miles on my car and truck back then.

Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#222

Post by eru »

stefanstokic wrote: post #125
mikeyouse wrote: post #45

Earlier quoted context omitted.

You're probably thinking of Sacca and Twitter: http://techcrunch.com/2011/02/27/jp-morgan-twitter-chris-sac... He may have done the same for Uber, but I haven't heard anything about that at all.

http://www.forbes.com/sites/alexkonrad/2015/03/25/how-ventur... "the Uber CEO got upset with Sacca for trying to repeat his Twitter move of buying up secondary shares in Uber from other initial investors."

I wonder why management would want to keep anyone from bidding up the share price?

Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#223

Post by nilkn »

morgante wrote: post #219
nilkn wrote: post #214

Earlier quoted context omitted.

They do. A "limo" is just a towncar. It's no different from something like UberBlack. Go to any major airport and you'll see a bunch of them lined up waiting for passengers nearby the taxis. I started using this service before Uber because taxis were extraordinarily unreliable and this service was always spot on. And as time has went on I see no reason to switch to Uber for this particular well-defined and scheduled-…

I think you view of the world is rather skewed if you think "normal" people take a town car to the airport. Even as a well-paid software engineer, I never use UberBlack—only UberX.

I just looked up a fare estimate and UberBlack is about twice as expensive as what I pay. So I suspect you're just as abnormal as me if you pay anyone at all to drive you to the airport instead of driving yourself. That actually drives home my point of not using Uber in this case. Why bother when I'm getting the same service for 50% of the cost with someone I know, trust, and have actually become friends with?

Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#224

Post by woah »

em3rgent0rdr wrote: post #210
martinald wrote: post #108

Earlier quoted context omitted.

But Standard Oil literally bought the refineries, railroad, long term contracts on crude. That would be like Uber buying every road and every manufacturer. I also don't think Uber's biggest competition is cars or taxis, I imagine it is public transport. The markets with the best scale (esp outside of US) have good public transit. People aren't going to go from paying a £10 uber to a £30 black taxi in London, they'll…

Uber's biggest competitor will be an open-source p2p-system, like openbazaar, that achieves the basic functionality of uber.

What advantage will such a system have?

Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#225

Post by loeg »

macspoofing wrote: post #158
loeg wrote: post #151

Earlier quoted context omitted.

You can split an Uber 4 ways but you can't split a bus fare. So if you go out with a few friends it becomes much more reasonable for short trips. If Uber gets more expensive, some people will go back to public transit.

>You can split an Uber 4 ways but you can't split a bus fare. Like a taxi? Uber will never come close to moving the sheer numbers that public transit does. You can't do it, not enough road to fit all those cars. Especially in downtown cores. So Uber competes with public transit as much as taxis compete with public transit.

Yes, like a taxi. The primary benefits Uber has over traditional Taxis are 1. price; 2. they have an app, and it works well; 3. drivers arrive in vaguely predictable times that are less than 45 minutes; and 4. it doesn't discriminate as badly as cabbies.

> Uber will never come close to moving the sheer numbers that public transit does. You can't do it, not enough road to fit all those cars. Especially in downtown cores.

I never suggested anything of the sort. Especially not at commute hours.

> So Uber competes with public transit as much as taxis compete with public transit.

I think we agree. I just noted that if Uber prices rose, some Uber users would prefer to use public transit rather than pay higher Uber prices or Taxi prices.

Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#226

Post by eru »

macspoofing wrote: post #133
pbreit wrote: post #126

Earlier quoted context omitted.

Plenty of people can envision a $100B to $1T valuation at some point. I don't understand your point about seed round investors since they are sitting on some of the biggest returns ever in the history of investing.

>Plenty of people can envision a $100B to $1T valuation at some point. $100B sure. $1T ... maybe if you wait a while to let inflation catch up.

Alphabet, Google's parent and briefly the most valuable company on the planet has a market cap of 510.2B USD right now.

And no debt to speak of, I think. Normally you need to add the equity market cap and the debt to get the total financial structure of the company. (I just googled, and I think that sum is called the `enterprise value', if you subtract any cash holdings.)

See http://arstechnica.com/apple/2011/08/does-this-metric-make-m...

Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#227

Post by toomuchtodo »

alttab wrote: post #183
morgante wrote: post #173

Earlier quoted context omitted.

> That is a problem, because the moment that people have to pay the actual costs of an Uber ride, they may go back to taxis or driving their own cars. There doesn't seem to be evidence of that. Uber is apparently profitable in its mature markets (mainly the US).[0] The money is mostly used to prop up new markets, where you have to give lots of incentives to get both sides of the market in place fast (keeping supply a…

I got some blood testing machines I'd love to sell you.

While driving home this evening listening to NPR's Marketplace, Kai Ryssdal specifically mentioned that Forbes removed Elizabeth Holems from their list of richest self-made women. Her stake in Theranos is now valued at $0 [1].

Capitalism giveth, and capitalism taketh away.

[1] https://news.fastcompany.com/elizabeth-holmess-net-worth-is-...

Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#228

Post by im3w1l »

macspoofing wrote: post #132
martinald wrote: post #108

Earlier quoted context omitted.

But Standard Oil literally bought the refineries, railroad, long term contracts on crude. That would be like Uber buying every road and every manufacturer. I also don't think Uber's biggest competition is cars or taxis, I imagine it is public transport. The markets with the best scale (esp outside of US) have good public transit. People aren't going to go from paying a £10 uber to a £30 black taxi in London, they'll…

I don't know about London, but in my area an UberX ride is 4-5x the price of a bus ticket (~10km). This only gets worse as the distance grows. Public transit is not Uber's competition and it'll never replace mass transit.

I don't think the multiple is the relevant metric. People aren't going "should I buy 5 bus tickets or should I buy 1 uber x ride?" The number of rides is pretty much fixed. The choice they are making is "should I upgrade my ride experience, if it means I have to downgrade an experience in another area?" So you should rather compare the price to other "upgrades" people are buying.

Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#229

Post by morgante »

nilkn wrote: post #223
morgante wrote: post #219

Earlier quoted context omitted.

I think you view of the world is rather skewed if you think "normal" people take a town car to the airport. Even as a well-paid software engineer, I never use UberBlack—only UberX.

I just looked up a fare estimate and UberBlack is about twice as expensive as what I pay. So I suspect you're just as abnormal as me if you pay anyone at all to drive you to the airport instead of driving yourself. That actually drives home my point of not using Uber in this case. Why bother when I'm getting the same service for 50% of the cost with someone I know, trust, and have actually become friends with?

If UberBlack is 2x the price you pay, what you pay is close to 2x what UberX costs (depending on the market).

It's fairly normal to take a taxi to the airport (particularly at your destination), but paying 2x the cost of a taxi for a private car service is definitely "luxury."

Re: Uber Turns to Saudi Arabia for $3.5B Cash Infusion

#230

Post by khc »

fiatmoney wrote: post #177
khc wrote: post #166

If they can get cash at a good deal, why not? 10 years later, if they do make a truckload of money from overseas expansions, they can pay back their investors with oversea cash without paying American taxes. Double win!

It is typically not legal to pay out (via dividends or share buybacks) to different investors of the same class in differing amounts. I'm not enough of a tax lawyer to say if you can do a miniature version of that by buying back stock of a US company listed on foreign exchanges without repatriating capital, but after arbitrage you would expect the effect to ripple back to the US-listed share price by the same amount.

This isn't about saving money per share, but using overseas money that many companies now avoid repatriating.
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