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Uber is facing the biggest crisis in its history

economist.com

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Re: Uber is facing the biggest crisis in its history

#121

Post by maxerickson »

smacktoward wrote: post #34
twblalock wrote: post #6

Here's the money quote: > If Mr Gurley and the rest of the board cannot find an experienced candidate willing to work with Mr Kalanick, calls for him to step down may grow louder. But that is his decision to take. Uber is a prominent example of founders’ power at fast-growing tech firms. On its own, Uber’s board does not have the clout to change the CEO, because of his super-voting shares and those of his co-founder,…

It also raises another good question: how big of a fool would you have to be to take the job Gurley and the board are trying to fill? How do you rein in a CEO who has total, unchallengeable control of the company? (Maybe if they offer enough money, it's worth it even if it's a suicide mission? Though "just cash the checks and wait for your inevitable dismissal" doesn't seem like an attractive offer for anyone who's g…

There's practically a limitless supply of people that would do it for $10 million.

The problem is finding someone worth paying that much (and the pretense that whether someone is worth paying that much can be determined ahead of time).

Re: Uber is facing the biggest crisis in its history

#122

Post by shostack »

twblalock wrote: post #63
smallgovt wrote: post #59

Earlier quoted context omitted.

Care to elaborate on why? The initial condition here is founders having full voting rights. In a free marketplace, they're free to sell shares without (or with little) voting rights as they wish. If investors aren't happy with it (which doesn't seem to be the case), they're free to not invest. You seem to be stating that there's a moral imperative that founders voluntarily give away voting rights to investors.

I don't know if I would call it a "moral" imperative, but it's a basic tenet of good corporate governance that the board, which represents the shareholders, should be able to prevent the management from harming the company or the shareholder's interests. In the case of Uber, the CEO could run the company into the ground, and nobody would be able to prevent that. A trend toward worse corporate governance could harm th…

Isn't that the "risk" part of private investment like this?

In theory if/when Uber goes public, the market can hammer his share price into submission. His choice then would be to step down and keep his money, or watch his valuation rapidly dwindle as low as the market dictates.

Re: Uber is facing the biggest crisis in its history

#123

Post by aianus »

nebabyte wrote: post #118
valuearb wrote: post #106

Earlier quoted context omitted.

That you are a an exception. I've never had a friend suggest Lyft, i'm not sure they even know what it is. They suggest uber all the time, and it's clear Uber has massively more market share.

And when the unsustainable "subsidized growth" period ends, Lyft will be the new word on the street. It's not exactly a high barrier to entry to hear about and install a new app in this day and age. If your reasoning is entirely anecdata, there's really no point in you engaging in threads about where businesses are going, since you'd only ever have something to contribute after it already happened.

Why would Lyft have any better margins than Uber once the subsidized growth period is over?

If anything Uber will have better margins as they can distribute their fixed costs across more rides due to their global availability.

Re: Uber is facing the biggest crisis in its history

#124

Post by [deleted] »

differentView wrote: post #111
sbov wrote: post #71

Earlier quoted context omitted.

I hate tipping because the rules are arbitrary, random, and unspoken. I have a few friends who work as servers in restaurants: anecdote, but they view anything under 20% of the bill total (including tax) as a "bad tip". This is partially because credit card receipts only include the total, not the tax separated out. So really, anything under around 22% is a bad tip. I tip 22% for full service, 10% for partial. If I g…

> This is partially because credit card receipts only include the total, not the tax separated out. So really, anything under around 22% is a bad tip. Can you explain the math? Why is this amount higher than 20% rather than lower than 20%?

[deleted]

Re: Uber is facing the biggest crisis in its history

#125

Post by sixothree »

hackuser wrote: post #96

I make a habit of talking to taxi drivers about Uber. Consistently they say they drive taxis because there is no money in driving for Uber (which of course that tells us less than it seems, because they are self-selected to be people who prefer driving taxis). One told me something new: I asked, as I often do, if they don't make money then why are there so many Uber drivers? This man said that some Uber drivers are t…

I get that same discomforting feeling seeing advertisements for pizza delivery. It's core to many businesses but the employees are often the ones providing the equipment.

I've heard this referred to as modern day share cropping.

Re: Uber is facing the biggest crisis in its history

#126

Post by hackuser »

sixothree wrote: post #125
hackuser wrote: post #96

I make a habit of talking to taxi drivers about Uber. Consistently they say they drive taxis because there is no money in driving for Uber (which of course that tells us less than it seems, because they are self-selected to be people who prefer driving taxis). One told me something new: I asked, as I often do, if they don't make money then why are there so many Uber drivers? This man said that some Uber drivers are t…

I get that same discomforting feeling seeing advertisements for pizza delivery. It's core to many businesses but the employees are often the ones providing the equipment. I've heard this referred to as modern day share cropping.

Pizza delivery employees generally don't take out loans to buy cars for the job, AFAIK.

Re: Uber is facing the biggest crisis in its history

#127

Post by hackuser »

nebabyte wrote: post #104
hackuser wrote: post #96

I make a habit of talking to taxi drivers about Uber. Consistently they say they drive taxis because there is no money in driving for Uber (which of course that tells us less than it seems, because they are self-selected to be people who prefer driving taxis). One told me something new: I asked, as I often do, if they don't make money then why are there so many Uber drivers? This man said that some Uber drivers are t…

> AFAIK; they have no long-term capital investment or debt trap Medallions?

> Medallions?

The medallion owners make a long-term capital investment. The drivers lease the car per shift or per 24 hours, and have no such investment. (As I understand it.)

Re: Uber is facing the biggest crisis in its history

#128

Post by st3v3r »

aianus wrote: post #123
nebabyte wrote: post #118

Earlier quoted context omitted.

And when the unsustainable "subsidized growth" period ends, Lyft will be the new word on the street. It's not exactly a high barrier to entry to hear about and install a new app in this day and age. If your reasoning is entirely anecdata, there's really no point in you engaging in threads about where businesses are going, since you'd only ever have something to contribute after it already happened.

Why would Lyft have any better margins than Uber once the subsidized growth period is over? If anything Uber will have better margins as they can distribute their fixed costs across more rides due to their global availability.

How many fixed costs are there? It's an app that sends location and messages, and does billing.

Re: Uber is facing the biggest crisis in its history

#129

Post by sqeaky »

ProAm wrote: post #110
sqeaky wrote: post #95

Earlier quoted context omitted.

They are valued at 70 Billion, how does that just wither and die? One lawsuit can be dragged out a long time and their lawyers will do their best to reduce and fees no matter how wrong Uber actually is (or isn't I don't know). Consider the size of Uber now and compare that to the size of Microsoft 15 years in the DOJ antitrust trial. They are about the same size, that gives them lots of options.

Valued at means nothing really, it speaks to investment and while its not worth nothing they are currently burning about 3/4 billion per quarter [1], and have no profitable quarters anywhere on the horizon. They have always been betting their future on autonomous cars and the Waymo lawsuit stands a good chance to set them back a decade and they do not have the current capital to withstand that. MS was already public…

$3 billion per year isn't that much at that scale, it would still take them many years to burn through their estimated cash reserves. That is if they did nothing and earned no money, but they earn something. They would have time to come up with a plan even if it were a backup backup plan that involved shedding a large fraction of the company.

If anything being public hinders options. Being private they can do a huge number of things public companies cannot, first and foremost is an IPO.

Re: Uber is facing the biggest crisis in its history

#130

Post by hackuser »

sbov wrote: post #50
sillysaurus3 wrote: post #42

Earlier quoted context omitted.

Tipping is often the only way for people to make end's meet. It lets people with excess money help out someone who really needs the help. I think most people's view would change if they were in a situation where tipping makes the difference between being able to pay your heating bill.

The entire point is that tipping shouldn't make the difference between being able to pay your heating bill. Tipping, as it exists in the US, is pretty much a dark pattern.

> The entire point is that tipping shouldn't make the difference between being able to pay your heating bill.

According to who? Certainly many restaurant workers in the U.S. earn most of their income from tipping.

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